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Question
For an annuity immediate paid for 3 years with interest compounded at 10% p.a., the present value is ₹24,000. What will be the accumulated value after 3 years? [Given (1.1)3 = 1.331]
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Solution
Given, P = ₹24,000, n = 3 years, r = 10% p.a.
i = `"r"/(100) = (10)/(100)` = 0.1
Now, A = P(1 + i)n
= 24,000(1 + 0.1)3
= 24,000(1.1)3
= 24,000(1.331)
A = 31,944
∴ Accumulated amount after 3 years is ₹31,944.
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