# Applications of series and sequences (Superannuation, repayments)

• Jul 26th 2008, 10:30 PM
Misa-Campo
Applications of series and sequences (Superannuation, repayments)
Question: At the beginning of each year, Sarah will deposit \$1000 in a fund paying 10% each year compound interest:

i) What will be the value of Sarah's first deposit when it has been invest for n years?

ii) Show that after n years the total value of all her deposits will be

1000(1.1)((1.1^n)-1)
---------------------
0.1

iii) Sarah decides to withdraw all her funds at the end of 20 years how much will she have?
• Jul 27th 2008, 12:18 AM
CaptainBlack
Quote:

Originally Posted by Misa-Campo
Question: At the beginning of each year, Sarah will deposit \$1000 in a fund paying 10% each year compound interest:

i) What will be the value of Sarah's first deposit when it has been invest for n years?

ii) Show that after n years the total value of all her deposits will be

1000(1.1)((1.1^n)-1)
---------------------
0.1

iii) Sarah decides to withdraw all her funds at the end of 20 years how much will she have?

..
• Jul 27th 2008, 12:26 AM
CaptainBlack
Quote:

Originally Posted by Misa-Campo
Question: At the beginning of each year, Sarah will deposit \$1000 in a fund paying 10% each year compound interest:

i) What will be the value of Sarah's first deposit when it has been invest for n years?

ii) Show that after n years the total value of all her deposits will be

1000(1.1)((1.1^n)-1)
---------------------
0.1

iii) Sarah decides to withdraw all her funds at the end of 20 years how much will she have?

..
• Jul 27th 2008, 12:28 AM
CaptainBlack
Quote:

Originally Posted by Misa-Campo
Question: At the beginning of each year, Sarah will deposit \$1000 in a fund paying 10% each year compound interest:

i) What will be the value of Sarah's first deposit when it has been invest for n years?

iii) Sarah decides to withdraw all her funds at the end of 20 years how much will she have?

iii. See the answer to part ii. but with n=20.

RonL