Question

How long will it take an RRSP to grow to $690,000 if it receives a contribution of $1,900 at the beginning of each quarter and it earns: (Do not round intermediate calculations and round up the number of payments, n, to the next whole number.)

  

a.	4.2% compounded quarterly	quarterly contributions
b.	6.4% compounded quarterly	quarterly contributions
c.	9.1% compounded quarterly	quarterly contributions
d.	9.9% compounded quarterly	quarterly contributions

Answer 1

Solution : Given Final Amount $ 690,000 Principal (P) $1900 (a) 4.2. coupounded quearterly nt FA plit > 100 uto 690,000 1900 ( 1+ (402/4) 100 6900 uto 19 4.2 WOO Applyling loge on B.si la l G900 19 uto in ( + U.2 400 In ta (6800) 5.89483771141891 un ( 404:3) 0.941781031446154415 ਪ੦੦ to 141 years. (6) 6.4% loupounded quarterly FA: Plant uto 6. 690000 1900 It l LOU 6900 19 ਪE . Reog .4 400 B. Apply log on

int 6900 19 wort to 406.4 hoo tos in (6900) 4 17 ( 406.44 9.99483771141891 O 06349339 66 251 GOGS to 92 years (c) 9.101. cou pounded quarterly ECO F.A EP Planet ut 690000 1900 ( 1 + HOO 6900 19 (40 **') 1409.) ut 400 0. Apply log in (5990) t ulo (409) 400 5.89483771141891 ta 4(0.022495077 827 37 09u) t = 66 years

(d) 9.9./. Colle pounded qucuterly FA - Р 5)^4 ut. 690000 1900 ( it 9.9 400 4t. 6900 19 (40909) B.S. Apply log 409.9 1066900) util uoo lo ( 6900 19 t = uln (40809) t = 5-89483771141891 0097794*2160923976 t - GO years