Hi all, I'm busy going through Pensions, and Q11.23 requires that I determine the rate at which Johnny Monachesi's business contributes to his pension given a current fund accumulation of 37000 (which I deduct off the EPV of the pension at his age of 40) arriving at 110403. I get the same equation, but I'm not seeing how the answer in my notes is correct: 6692k = 110403 is the final equation and the answer in the notes has k solved to be 0.125 (= 12.5%). Not entirely sure about the mathematics here. Am I missing something? I'm using the 2016 CT5 notes by the way. Thanks!
Given that he contributes 4%, we need to find balancing contribution by firm. Equation is \(6692 k = 110403\) gives \(k = 16.5\%\) This is total contribution to scheme. now Johny contributes \( 4\%\) and firm contributes \( 16.5\% - 4\% = 12.5\%\)
Sorry deepakroamore, I'm not seeing how 16.5% of 6692 equals 110403. Can you please explain what it is that I don't know here? Thanks.
Right so this was a stupid post. I incorrectly manipulated this pathetically simple little equation. Thanks Deepak.
