Future Value Annuity fomr QMA (1 Viewer)

[~::UAI::~]

just wondering if the interest rate said, goes up or down for a FV scenrio, such as if you are savng, and the interest rate increases. how do we go about doing this tye of question when the rate changes. example do we calculate FV for the old rate for that compounding period, and then calculate the FV using the new rate for the remaining of the period?

such as if i deposit $100 monthly in the bank, the interest rate was 6%p.a. compounded monthly, but then after 10 months, the interest rate increase and i now got 7%p.a compounding monthly. so how much would i get in the end of the year?

Many thanx, helps are very appreciated! >_<

 

[Jago]

find the final amount for 10 months at 6%, then make another annuity for 2 months at 7%

 

[~::UAI::~]

thanks for replying, but i still didn't get the correct answer needed. and also, how do we work out repayment for deferred annuity. i have a question in which you defer by x month, and then payment period is y. interest rate is z% p.a compounded monthly, and you are given original loan amount, how do we work out repayment for this loan?
do use present value annuity due or future vaule annuity due?

 

[dm4n]

calculate the FV of 10 months then times that by the new interest rate (1+0.07/12)2 then do another annuity for 2 months and add them up i think

 

[pLuvia]

Find the FV for the 10months, then compound that by (1+0.07/12)for the remaining 2 months then find the FV for the remaining 2 months using the new interest rate then add them both together

 

[~::UAI::~]

thanks, eveybody.... but BTW, how would you go about doing the question about the deferered annuity payment where you are required to find the amount of repayment for a loan that is deferred for mths. many thanks >_<

 

[pLuvia]

Find the PV from when the first payment was made, and depending if the payments were made in arrears or in advanced, discount it to the relevant amount of months to time 0