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CT1 April 2013 Q8 DPP

Discussion in 'CT1' started by Adam Ahmed, Sep 10, 2017.

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  1. Adam Ahmed

    Adam Ahmed Keen member

    Hey all,

    I trust everyone's revision is going well? I had a query regarding DPP, wondering if someone could assist me. Attempting Q8 in April 2013, I get a slightly different answer to the mark scheme even though my equation of value is the same as the mark scheme.

    The only difference in my approach is the way I've set up my Geometeric series, which shouldn't make any difference. Wondering If someone could critique my working out? Really can't see why I'm not getting the correct answer.

    Question and my working out are attached.

    Thanks in advance.

    W
     

    Attached Files:

    Adam Ahmed, Sep 10, 2017
    #1
  2. John Lee

    John Lee ActEd Tutor Staff Member

    Since the last year (Year 8) would have PV of income of \(75.6*1.04^5v^8\), your general rule should be \(75.6*1.04^{n-3}v^n\).
     
    John Lee, Sep 21, 2017
    #2

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