Question

Mr.X invests Rs. 10000 every year starting from today for next 10 years ,suppose interest
rate is 8% per annum compounded annually Given that ( 1+0.08)10=2.15892500)
a) Rs.156454.88 b) Rs. 144865.625 c) Rs.156554.88 d) None of these​

Answer 1

Answer:

answer is Rs.156454.88

Answer 2

Disclaimer:

Calculate the future value of the annuity.

Concept:

The annuity can be calculated as,

Annuity, A = R/i ((1 + i)ⁿ - 1)

where R is the fixed amount deposited at end of every year, i is the interest rate and n is the number of years.

Given:

Rs. 10000 deposited every year starting from today for the next 10 years with an interest rate of 8% per annum compounded annually.

Find:

The future value of the annuity.

Solution:

Total Annuity amount,

For R = 10000, i = 8% and n = 10,

A = R/i ((1 + i)ⁿ - 1)

A = 10000/0.08 ((1 + 0.08)¹⁰ - 1)

A = 10000/0.08 (2.15892500- 1)

A = 10000 × 14.4865625

A = Rs. 144865.625

Multiplying the result by (1+i) as the annuity is given today,

Total annuity = 144865.625 × (1+0.08)

Total annuity = 156454.875

Hence, the future value of the annuity is Rs. 156454.88. Hence, the correct option is (a) Rs. 156454.88.

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