# IBDP Maths AA: Topic : SL 1.4: Financial applications of geometric sequences and series: IB style Questions HL Paper 2

### Question

Give your answers in this question correct to the nearest whole number.

Shahid invested 25 000 Singapore dollars (SGD) in a fixed deposit account with a nominal

annual interest rate of 3.6 %, compounded monthly.

1. Calculate the value of Shahidâ€™s investment after 5 years. [3]

At the end of the 5 years, Shahid withdrew x SGD from the fixed deposit account and

reinvested this into a super-savings account with a nominal annual interest rate of

5.7 %, compounded half-yearly.

The value of the super-savings account increased to 20 000 SGD after 18 months.

2. Find the value of x . [3]

Ans:

(a)

$$FV=25000\times (1+ \frac{3.5}{100\times 12})^{12\times 5}$$

OR

N= 5

I%=3.6

PV= $$\mp 25000$$

$$P/Y$$ = 1

C/Y = 12

OR

N= 60

I%=3.6

PV = $$\mp 25000$$

P/V = 12

C/Y = 12

FV=29922(SGD)

(b)

2000= PV\times $$(1+\frac{5.7}{100\times 2})^{2\times 1.5}$$

OR

N= 1.5

I%=5.7

FV=$$\pm 20000$$

$$P/Y$$ = 1

C/Y= 2

OR

N=3

I%= 5.7

FV = $$\pm 20000$$

P/V=2

C/Y = 2

X= 18383 (SGD)