An actuary invests 1000 at the end of each year for 30 years. The investments will earn interest at a 4% annual effective interest rate and, at the end of each year, the interest will be reinvested at a 3% annual effective interest rate. Calculate the accumulated value of the investment at the end of the 30-year period. (A) 51,625 (B) 53,434 (C) 55,260 (D) 58,437 (E) 58,938
An actuary invests 1000 at the end of each year for 30 years. The investments will earn interest at a 4% annual effective interest rate and, at the end of each year, the interest will be reinvested at a 3% annual effective interest rate. Calculate the accumulated value of the investment at the end of the 30-year period. (A) 51,625 (B) 53,434 (C) 55,260 (D) 58,437 (E) 58,938
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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
Transcribed Image Text:An actuary invests 1000 at the end of
each year for 30 years. The
investments will earn interest at a 4%
annual effective interest rate and, at
the end of each year, the interest will
be reinvested at a 3% annual effective
interest rate. Calculate the
accumulated value of the investment
at the end of the 30-year period.
(A) 51,625 (B) 53,434 (C) 55,260 (D)
58,437 (E) 58,938
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