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October 14th, 2012, 05:23 PM  #1 
Newbie Joined: Oct 2012 Posts: 1 Thanks: 0  financial mathematical (foundation level)
Determine how long RM5000 must be left to accumulate at 15% p.a. compounded monthly for it to amount to twice the accumulated value of another RM5000 deposited at the same time at 9% p.a. compounded quarterly.

October 14th, 2012, 07:52 PM  #2 
Global Moderator Joined: Nov 2009 From: Northwest Arkansas Posts: 2,766 Thanks: 4  Re: financial mathematical (foundation level)
73 months

October 14th, 2012, 08:35 PM  #3  
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 13,950 Thanks: 987  Re: financial mathematical (foundation level) Quote:
 
October 14th, 2012, 09:40 PM  #4 
Senior Member Joined: Jul 2010 From: St. Augustine, FL., U.S.A.'s oldest city Posts: 12,211 Thanks: 520 Math Focus: Calculus/ODEs  Re: financial mathematical (foundation level)
You want to solve: for t, in years. Do you see why? I got: 
October 15th, 2012, 02:36 AM  #5 
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 13,950 Thanks: 987  Re: financial mathematical (foundation level)
Agree. Another way is convert the quarterly rate to its equivalent monthly rate: r = (1 + .09/4)^(1/3)  1 = .0074444427.... (1 + .15/12)^n = 2(1 + r)^n n = LOG(2) / LOG[(1 + .15/12) / (1 + r)] = 138.472951883... months 
October 15th, 2012, 02:59 AM  #6  
Global Moderator Joined: Nov 2009 From: Northwest Arkansas Posts: 2,766 Thanks: 4  Re: financial mathematical (foundation level) Quote:
 
October 15th, 2012, 07:02 AM  #7 
Math Team Joined: Oct 2011 From: Ottawa Ontario, Canada Posts: 13,950 Thanks: 987  Re: financial mathematical (foundation level)
Good point!


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