Home › CA Foundation › Quantitative Aptitude › Compound Interest › An annuity of Rs.500 is paid for 10 years at 10%…
An annuity of Rs.500 is paid for 10 years at 10% per annum. The future value is approximately
ARs.7969
BRs.8500
CRs.7000
DRs.9000
Answer & Solution
Correct answer: A. Rs.7969
1. FV of annuity = A * [((1.10)^10 - 1) / 0.10].
2. (1.10)^10 = 2.5937.
3. Annuity factor = (2.5937 - 1) / 0.10 = 15.937.
4. FV = 500 * 15.937 = 7968.7, approximately Rs.7969.
_Source: ICAI BoS Foundation Paper 3, Ch 4 'Math of Finance', p.14_
Related questions
If a sum at compound interest doubles in 6 years, in how many years will it become 8 timesIf the simple interest on a sum at 6% p.a. for 3 years is ₹540, what is the compound interIf CI for 1st year is ₹500 and for 2nd year is ₹525 on a certain sum at the same rate, finThe compound interest on ₹16,000 for 3 years at 5% p.a. compounded annually is:At what rate compounded annually does ₹4,000 amount to ₹4,840 in 2 years?A sum amounts to ₹6,050 at 10% p.a. compound interest in 2 years. Find the principal.Find the difference between CI and SI on ₹10,000 at 10% p.a. for 2 years.The compound interest on ₹5,000 at 10% p.a. for 2 years compounded annually is: