KLand:
THE ANSWER IS: N19,982,958.38

SEE THE CALCULATION HERE: http://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php

Year Year Deposits Year Interest Total Deposits Total Interest Balance

1 N240,000.00 N16,186.56 N240,000.00 N16,186.56 N256,186.56
2 N240,000.00 N48,677.43 N480,000.00 N64,863.99 N544,863.99
3 N240,000.00 N85,288.95 N720,000.00 N150,152.94 N870,152.94
4 N240,000.00 N126,543.73 N960,000.00 N276,696.68 N1,236,696.68
5 N240,000.00 N173,030.65 N1,200,000.00 N449,727.33 N1,649,727.33
6 N240,000.00 N225,413.28 N1,440,000.00 N675,140.61 N2,115,140.61
7 N240,000.00 N284,439.33 N1,680,000.00 N959,579.94 N2,639,579.94
8 N240,000.00 N350,951.37 N1,920,000.00 N1,310,531.31 N3,230,531.31
9 N240,000.00 N425,898.79 N2,160,000.00 N1,736,430.10 N3,896,430.10
10 N240,000.00 N510,351.43 N2,400,000.00 N2,246,781.53 N4,646,781.53
11 N240,000.00 N605,514.77 N2,640,000.00 N2,852,296.30 N5,492,296.30
12 N240,000.00 N712,747.20 N2,880,000.00 N3,565,043.50 N6,445,043.50
13 N240,000.00 N833,579.40 N3,120,000.00 N4,398,622.90 N7,518,622.90
14 N240,000.00 N969,736.14 N3,360,000.00 N5,368,359.03 N8,728,359.03
15 N240,000.00 N1,123,160.96 N3,600,000.00 N6,491,519.99 N10,091,519.99
16 N240,000.00 N1,296,043.89 N3,840,000.00 N7,787,563.88 N11,627,563.88
17 N240,000.00 N1,490,852.70 N4,080,000.00 N9,278,416.58 N13,358,416.58
18 N240,000.00 N1,710,368.15 N4,320,000.00 N10,988,784.72 N15,308,784.72
19 N240,000.00 N1,957,723.64 N4,560,000.00 N12,946,508.37 N17,506,508.37
20 N240,000.00 N2,236,450.01 N4,800,000.00 N15,182,958.38 N19,982,958.38

Your "brute force approach" to this problem is commendable. However it is faulty because you are using N240, 000 yearly to Compute the yearly interest. Remember that of this N240,000

in the 1st year,
Only N2,000 stayed complete 1 year with the bank
Another N2,000 stayed with the bank for 11 months
Another N2,000 for 10 months etc

this same sinaro occur each year: 2ndd , 3rd up to the 20th year

Your Computation had assumed several bulk of N240,000 is being deposited yearly.

irenmwinfo:
This is pure Economics not Mathematics to calculate just use this formulae. FUTURE WORTH= PRESENT VALUE( 1+ INTEREST RATE ^Number OF YEARS) I.e FV= PV (1 + r^20 )
Fv ?
Pv= #2000
r= 12% I.e 0.12 remember it's in %
n= 20years
Therefore, FV= 2000 (1+ 0.12^20) = 2000 ( 1.12^20)
2000 X 9.646293093 = #19,292.58619
Thank you all I think you are convinced now like if you love ❤ Economics + Mathematics

Your result can not be realistic. Mathematics Can't be ruled out. Even your so called Economic Analysis is Mathematics. If not the banks Won't be able to automate the computations with there Software. Note that all Computations Automated in Accounting, Economics, Commerce, marketing, insurance, etc are all accomplished using mathematical formula in a given Computer program.

Check out Don Whest mathematical Analysis for the correct answer to the problem.

Na Maths and Computer program be the answer oo o to all Accounting and Economic automated Computations.

Kennedyiheme:
lol even without solving u'll knw its impossible for anybank to give you interest of 19million like u hve said, on a 480,000 deposit? , all tht formular won't work, ur answer is wrong

There is formula for this. You only need apply it appropriately just as Don Whest have rightly done.

GlorianaCO:
The answer is 507.336

You are Close but I think this isn't the answer

FV -> Future value ( after the period )
PV - Present value ( Total Money deposited )
CI-> Compond Interest
d -> monthly deposit ( Principal for the CI )
i -> annual nominal interest rate
t -> No. of years
n -> No. of times per year
Note that: nt -> [ n x t = 12 months x 20 years = 240 months is the period of investment]

FV = PV + CI

PV = d x nt
= 2000 X 12 months X 20 years
= 2,000 X 240 months = N480,000

CI ( Evaluated on the basis of monthly deposit )
= d ( 1 + i / n ) ^ nt
= 2,000 ( 1 + 0.12 / 12 )^ ( 12 X 20 )
= 2,000 ( 1 + 0.01 )^240
= 2,000 ( 1.01)^240
= 2,000 X 10.89255365387
= N21,785.11

:. FV = N480,000 + N21,785.11
= N501,785.11


Don Whest
( 07046890175 - SMS Only )