Another superannuation question (1 Viewer)

[sinophile]

AN employee joins a superannuation fund on their eighteenth birthday by investing $3000 in the fund. This investment is repeated every six months until retirement on their sixtieth birthday. (Last payment is made six months before retirement)

If the interest rate of 12.25% per annum is compounded six monthly, calculate the amount they will receive on retirement.

 

[kooltrainer]

i nvr liked these questions but jus use the formula easy : )

 

[kooltrainer]

alright... i'l jus do it
p = M(1+R) + M(1+R)^2 + ........ + M(1+R)^n

= M(1+R) ( (1+R)^n -1)
------------------------------
R

sub into values with
M=3000
n= 42
R=12.25 / 2

i think it shuld be correct

 

[lyounamu]

alright... i'l jus do it
p = M(1+R) + M(1+R)^2 + ........ + M(1+R)^n

= M(1+R) ( (1+R)^n -1)
------------------------------
R

sub into values with
M=3000
n= 42
R=12.25 / 2

i think it shuld be correct

No. There is no set "formula". It depends entirely on the question and n is not entirely correct...

R = 12.25/2 %

TO 19TH = (3000 x (1+R/2) + 3000)(1+R/2)
TO 20TH = (((3000 x (1+R/2) + 3000)(1+R/2))+3000) x (1+R/2)+3000) x (1+R/2)
...
TO 60TH = (3000 X (1+R/2) ((1+R/2)^(2x42) - 1))/(1+R/2 - 1) = 7613157.702...