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$10,000 is invested for five years at an interest rate of 10%
per annum and at the end of year 3, $2,000 is withdrawn. How much
remains at the end of year 5? (Give your answer to the nearest whole $)Hello Sir, I want to know the answer. I can’t solve
Why are you attempting a question for which you do not have an answer? You should be using a Revision Kit from one of the ACCA Approved Publishers. It has answers and explanations.
After 3 years the investment will have grown to 10,000 x 1.10^3
They take out 2,000 which means they then have (10,000 x 1.10^3) – 2,000
This balance is left for another 2 years, so at the end of 5 years they have:
((10,000 x 1.10^3) – 2,000) x 1.10^2)(This is not investment appraisal, and the approach is explained in my free lectures on ‘interest’. The lectures are a complete free course for Paper MA and cover everything needed to be able to pass the exam well.)
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