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#1
07-08-2011, 08:31 AM
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Interest Calculation question
Okay, I'm about ready to turn in my actuarial credentials and open a dog grooming business! Why can't I match this table???
 "Present value of annuity certain of $1 per week. Interest at 5% per annum with annual rests. Payment at end of week 365.2425 days to a year." What is the PV formula for X number of weekly payments? And why can't I hit it? (Okay, don't answer the second question!)
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There is only one success: To be able to spend your life in your own way. That's a very interesting argument. But I'm afraid you are a moron. -- The Drowsy Chaperone 
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#2
07-08-2011, 08:34 AM
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They're probably over simplifying the interest, you're probably compounding it weekly. I refuse to give any actual guidance for fear of doing it wrong.
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#3
07-08-2011, 08:42 AM
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Ok I haven't looked at FM material for many years but isn't this just the a angle n formula? What are you doing? And what are the answers that you should be getting? Insert more info please!
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#4
07-08-2011, 08:43 AM
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Yes, I should have clarified: I'm trying to hit the effective interest rate. It really shouldn't be this hard, right?
__________________
There is only one success: To be able to spend your life in your own way. That's a very interesting argument. But I'm afraid you are a moron. -- The Drowsy Chaperone
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#5
07-08-2011, 08:44 AM
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This is exactly why girls shouldn't be allowed to do math.
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#6
07-08-2011, 08:49 AM
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a angle n (n in weeks, i=weekly effective)
effective weekly rate is .05/52 effective annual = (1+.05/52)^52 -1 = .051245842 what does annual rests mean?
__________________
Ridicule is the only weapon which can be used against unintelligible propositions. - Thomas Jefferson
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#7
07-08-2011, 08:50 AM
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Quote:
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Vomik: will you... will you be my life coach?
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#8
07-08-2011, 08:53 AM
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Quote:
Quote:
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#9
07-08-2011, 08:53 AM
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Quote:
the weekly rate they are using is 0.0009582675 how did they get that?
__________________
There is only one success: To be able to spend your life in your own way. That's a very interesting argument. But I'm afraid you are a moron. -- The Drowsy Chaperone
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#10
07-08-2011, 08:53 AM
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Quote:
Where n = x payments i = .0009387 v = 1/(1+i) They could have used i = .05/52 to simplify.
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Rubber ducky, you're the one!
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