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Simple formulae for annuity functions

M

Michael Truscott

Member
Hello....

I'm looking at revision notes book 2, question 12 (CT1 - April 14 - Q12).

To answer the question you have to value the following annuities
  • £4000 pa, monthly in advance, for four years (so an 'a' with two dots on, with a 12 in brackets above it, and a 4 in the little box)
  • £5000 pa, quarterly in advance, for four years
  • £6000 pa, continuously, for four years

There are a mix of interest rates to use but let's use 7% for now.

I can write down the annuity functions but the answer in the back of the book just gives the final value of each function without showing how it was derived. I don't have my CT1 notes anymore (& can't see anything in CM2) and so was wondering if someone could let me know what the simple formulae is for each of these please? 7% isn't in the formula book and so I'm stumped!

Cheers

Mike
 
Turns out I do have my CT1 notes and I’m sorted!
 
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