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Unformatted text preview: APR is 10%, which is also the EAR due to annual compounding. So we can use the formula for the future value of an annuity to solve for the value of C . You should write the following in order to receive the full mark of this question. ] 1 . 1 ) 1 . 1 ( [ $ 000 , 500 $ ] 1 ) 1 ( [ $ 45-+ =-+ = C r r C FV t C = $695.50 Writing down formulas even when you are using a financial calculator is certainly to your advantage. In case you write down formulas but get final answers wrong, you will still receive partial marks for the question because of the formulas written. In contrast, if you do not write down formulas and get final answers wrong, you will receive a mark of zero for the question. (Strictly speaking, a sequence of financial calculator keystrokes is not formulas.) In summary, please write down formulas used and show substitutions of parameter values into the formulas before giving your final answers. 1...
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- Spring '09