Hi, On question 3 from CM1A, April 2023. "Calculate a(4):82.25" I understood the solution provided, but I tried to calculate in a different way, the result being slightly different: a(4):82.25 = a(4):82 - 0.25 * v^0.25 * l82.25/l82 Is this approach correct? I was expecting to have the same result as it is on solution, but it is not. I get 5.93 while the solution is 6.09. Am I doing something wrong? Thank you!
Hi, The idea is good: take the expected present value of an annuity paying quarterly in arrears from age 82 but remove the EPV of the first payment. However, this is the expected present value at age 82. We need the expected present value of the annuity at age 82.25. So you need to take your value and accumulate for a quarter of a year with interest and mortality ie: (5.93 x 1.04^0.25) / 0.25p82 = 6.09. Hope this helps. Joe
