tables and accuracy

Hi,

Does anyone know if it is ok to use the values in the tables for annuities etc in the exam, or should these be calculated for complete accuracy?

Also, what level of accuracy is required in the calculations, ie how many decimal places etc should be given in answers?

Thanks

 

Hi,
Use the tabulated values whenever possible.

But don't forget its vital to leave an audit trail in case you make an error using your calculator. ie write down the formula before doing the numerics. Better still leave further clues like putting in a bit of English like :
PV pf premiums
Then the formula
PV of benefits
{formula}
PV expenses
{formula}
EQUATION OF VALUE
etc

If you rework all factors that are automatically available you run all the following risks which are too great:
a) error in your calculator
b) you use the wrong formula (eg get a wrong power)
c) creates excessive time pressure

As for accuracy I'd say don't round intermediate calcs to fewer than 4 dp. Give answer to 2 dp if its say a premium, 4 dp if its a factor eg value of an annuity

You shouldn't lose too many marks for rounding unless its excessive.

Hope this helps.

 

slightly different viewpoint:

yes it's fine to use the values in the Tables but the choice between Tables and calculator is a personal one.

I used to be able to work things out in my calculator quicker than looking them up and so saved time that way. Although arguably you're more prone to making mistakes.

Of course, not every value is tabulated and so make sure you can do the calcuations quickly too.

 

thanks a lot guys, most helpful! In practice questions I think I am quicker looking up the value in the tables so I guess I will stick with that were possible.