- 1 Marks
Question
How much should Mr. Eaglet set aside at the end of each year to replace his motor car in 5 years’ time if the cost of a new car remains at ₦5 million and the rate of interest stays at 7% per annum?
A. N669,349.23
B. N779,349.23
C. N869,349.23
D. N979,349.23
E. N989,349.23
Answer
C. N869,349.23
Explanation:
To calculate the annual payment required to accumulate a future sum, we use the formula for the future value of an annuity:
- Tags: Annuities, Financial planning, Future Value, Savings
- Level: Level 1
- Topic: Basics of Business Finance and Financial Markets
- Series: NOV 2020
- Uploader: Dotse