Page 16
EXAMPLE 4
Money is invested for five years in a savings account earning 7% effective. If the rate of inflation
is 10% find the percentage of purchasing power lost during the period of the inve
LECTURE 5
EXAMPLE 1
An account pays $1,500 at the end of 10 years at 5% per annum convertible monthly.
How much was deposited initially?
EXAMPLE 2
In return for a promise to receive $1,000 at the end
Page 29
3.2 Annuities Immediate
3.3 Annuities Due
Annuity: Series of payments made at equal interval of time (original annuity)
We only consider annuity certain payments - made for a fixed, known peri
Page 37
- Outstanding principal
- Unpaid balance
- Remaining loan indebtedness
Suppose a loan of amount L to be repaid at the end of n time periods by payments at the end
of each period. Assume these
Page 54
4.4 Annuities with payment less frequent than each interest period and payments in AP
4.5 Annuities with payments more frequent than each interest period and payments in AP
4.6 Continuously pa
Page 1
A savings account start with $1,000 and has a level annual effective discount rate of 6.4%. Find the
accumulated value at the end of five years.
Latisha wishes to obtain $4,000 to pay her colle
LECTURE 4
EXAMPLES
EXAMPLE 1
Find the accumulated value of $500 invested for 5 years if the force of interest is 5%.
EXAMPLE 2 (TEXT, Ch 1, Review Proble
MATH 4410
LECTURE 1
1.3, 1.4, 1.5
EXAMPLE 1
Assume
(a) A(t ) = 300(1 + 0.05t )
(b) A(t ) = 300(1.05) t
Find i = i1
and
i5
EXAMPLE 2
Find the accumulated value
LECTURE 8 EXAMPLES
EXAMPLE 1
Find the present value of an annuity which pays $100 at the end of each month for 10 years if the rate of
interest is 7% convertible mon
LECTURE 12
EXAMPLE 1
Find the accumulated value 18 years after the first payment is made of an annuity on which there are 8
payments of $2,000 each made at two-year
MATH4410
LECTURE2
1.6,1.7,1.8
EXAMPLE1
Assumethesameamountfunctionsasinexample1,Lecture1.
Find d = d1
and
d 5 (theeffectivediscountratesforthefirstandfifthtimeperiods)
EXAMPLE2
Howmuchmustbeinvestedat
LECTURE 9
EXAMPLE 1
A woman has an inheritance in a trust fund for family members left by her recently
deceased father that will be $50,000 at the end of each year indefinitely into the future.
She ha
MATH 4410
LECTURE 6
EXAMPLE 1
An investor makes a single deposit of $10,000 into Fund A for 10 years which earns a 6% effective rate of
interest payable directly to
MATH 4410
LECTURE 3
EXAMPLE 1 (Text, p66, Q2)
Latisha wishes to obtain $4,000 to pay her college tuition now. She qualifies for a loan with a level
annual effectiv
LECTURE 11
EXAMPLE 1
An investment of $1,000 is to be used to make payments of $100 at the end of each year for as long as
possible. If the fund earns an annual
LECTURE 10 EXAMPLES
EXAMPLE 1 (text, p172, Q8)
On January 1, Alex received an inheritance of a thirty-year annuity. Starting on the day
of the inheritance, the annuity pays $1,000 each January 1, $2,0