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
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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
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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