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Nairaland Forum / Nairaland / General / Education / If You Can Solve This Maths, A Financial Institution Should Employ You. (64295 Views)
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Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by ameer2: 11:50am On Aug 15, 2015 |
N22046.35 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 11:58am On Aug 15, 2015 |
Formular to find the FV of an annuity is P = PMT [((1 + r) n - 1) / r] P = The future value of the annuity stream to be paid in the future PMT = The amount of each annuity payment r = The interest rate n = The number of periods over which payments are made Since it is compounded annually, each monthly payment of annuity is converted to an annual figure. i.e he saves #2000/month * 12 = #24000 annual payment. applying the formular, #24000 [(( 1+0.12)^20 -1)/ 0.12] = #1,729,258.619 I hope i'm correct. 2 Likes 1 Share |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 11:59am On Aug 15, 2015 |
FriedPlantain: As you can see in the question, annually. But that does not mean you'll disregard the 'month" part of the question. 1 Like |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:03pm On Aug 15, 2015 |
Thavybe: Bro, you came very close. May be calculation error somewhere. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Liamm(m): 12:07pm On Aug 15, 2015 |
537600 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:09pm On Aug 15, 2015 |
walexy30:Nope, my calculations are correct. if there is a mistake, then it means that i didn't apply the correct formular. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by fragrant(f): 12:20pm On Aug 15, 2015 |
OP |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:20pm On Aug 15, 2015 |
Thavybe:Which was why I was asking him if the monthly payments are made at the beginning or end of each month. Your calculation was correct, jarey |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by rapins: 12:24pm On Aug 15, 2015 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:28pm On Aug 15, 2015 |
FriedPlantain: Whether at the beginning or the end, the cash flow runs 240 times. I make the deposits 240 times during the period 1 Like |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:31pm On Aug 15, 2015 |
FriedPlantain:Yes, but the answer is wrong. 240 monthly payments of #2000 compounded at an annual rate of 12% will give a slightly higher value than my answer. what i have just done was a 20 #24000 yearly payment at a compounding rate of 12%. 1 Like |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:33pm On Aug 15, 2015 |
walexy30:I get u, the solution to answering this thing is a matter of knowing the right formular. Make i try am again, if i no get am this time, then OP i give up. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:35pm On Aug 15, 2015 |
Thavybe: Bro, you are good! Try again. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by prinzayf(m): 12:37pm On Aug 15, 2015 |
1978510.731 4 Likes |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:39pm On Aug 15, 2015 |
walexy30:Yeah, you are right. I think where we are making the mistake is compounding the interest of the first month of payment. Wait, I'm coming with a better answer soon |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by alsudaes1(m): 12:40pm On Aug 15, 2015 |
#231,511.03 3 Likes 1 Share |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:41pm On Aug 15, 2015 |
Thavybe:That is if the interest is compounded monthly and not annually. Or that is just what I assume. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:47pm On Aug 15, 2015 |
prinzayf: Yes, you got it. But let's see the calculations. 1 Like 1 Share |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:54pm On Aug 15, 2015 |
You can see the power compounding, N2,000 savings every month with assumed interest rate of 12% will fetch you N1,978,510.72k in the next twenty years. Maths is good! i love it especially financial maths. 7 Likes 1 Share |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:55pm On Aug 15, 2015 |
The monthly interest rate is 1% Fv = pv ((1+r)n-1)/r Fv = 2,000[(1+0.01)240-1]/0.01 =N1,978,510.73 5 Likes 1 Share |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 12:56pm On Aug 15, 2015 |
prinzayf:Bros show us ur calculations abeg. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by AdeniyiA(m): 12:57pm On Aug 15, 2015 |
walexy30:well, I have a formula I derived here... 480,000 + 0.12(A1+A2+A3+- - - A19) In the end I got #542,128.22 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Ekpekus(m): 1:00pm On Aug 15, 2015 |
2,142,857.3 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 1:00pm On Aug 15, 2015 |
walexy30:You can only use the "rate equivalent approach" to solve this thing. i am only interested in the formular you used. This stuff is finance related o, are you studying accounting or studied accounting? |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 1:01pm On Aug 15, 2015 |
If the Monthly saving is N10,000, we can even extrapolate with N9,892,553.60k in the next twenty years. |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by prinzayf(m): 1:05pm On Aug 15, 2015 |
Thavybe:convert d annual interest rate to monthly interest rate 240 monthly payments of #2000 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Nobody: 1:06pm On Aug 15, 2015 |
Thavybe: I am a school cert. holder but tutored in LASU. Thanks to Mr. C.A. JEGEDE (Banking anf Finance Dept.) for his educative textbook. 6 Likes |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by bosco9: 1:09pm On Aug 15, 2015 |
The bal after 20yrs is #19292.581k while the simple interest after the 20yrs is 4800 |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by Alcheringa(m): 1:10pm On Aug 15, 2015 |
sureguy02:Correct! I hv done it too 1 Like |
Re: If You Can Solve This Maths, A Financial Institution Should Employ You. by prinzayf(m): 1:16pm On Aug 15, 2015 |
walexy30:#2000 [(( 1+0.01)^240 -1)/ 0.01] = #1,978,510.73 1 Like 1 Share |
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