it says we can also solve this question by adjusting the annual rate to monthy. i cannot get the answer that way can someone help
Share
Sorry, you do not have permission to answer to this question.
SSEI QForum
Please briefly explain why you feel this question should be reported.
Please briefly explain why you feel this answer should be reported.
Please briefly explain why you feel this user should be reported.
Step 1: e^.10 = 0.105171*100 = 10.5171
Step 2: 2ND CLR TVM
PV -5000
I/Y 10.5171
N 18/12 = 1.5
CPT PV = 5809.1712 [which is close to Option C]
For annual, the exponent is e^0.1*1.5 = e^0.15
For monthly, the exponent is e^(0.1/12)*18=e^0.15
Both methods will yield same answer, i prefer yearly due to year bias 🙂