Jacky2332
Badges: 2
Rep:
?
#1
Report Thread starter 1 year ago
#1
I am struggling to understand the questions can you guys please fully answer it and explain the procedure used to work it out.

2. (a) Find the daily rate of interest paid (to 6 dp) if a building society pays customers an AER of 2.71 % on a savings account (5 marks)
(b) How much would an amount £28,000 accumulate to if it was left in this account for 122 days? (5 marks)

3. If the market interest rate is 3.1% how much would you expect to pay for :
(a) an annuity which guarantees to pay you £12,000 annually for the next 20 years ? (5 marks)
(b) a perpetual annuity which will pay the same annual amount as in (a) ? (5 marks)
If someone has saved £ 287, 000 to buy an annuity when they retire,
(c ) what annual income could they expect if they bought an annuity that paid out for 20 years , given the above interest rate?
0
reply
X

Quick Reply

Attached files
Write a reply...
Reply
new posts
Back
to top
Latest
My Feed

See more of what you like on
The Student Room

You can personalise what you see on TSR. Tell us a little about yourself to get started.

Personalise

University open days

  • University of Stirling
    Undergraduate Open Day Undergraduate
    Thu, 26 Sep '19
  • Heriot-Watt University
    Undergraduate Open Day - Scottish Borders Campus Undergraduate
    Fri, 27 Sep '19
  • Royal Holloway, University of London
    Undergraduate open day Undergraduate
    Sat, 28 Sep '19

Are you attending a Global Climate Strike?

Yes, I'm striking (35)
7.25%
No, but I wanted to/I support the cause (285)
59.01%
No (163)
33.75%

Watched Threads

View All