SOA Exam FM Sample Question 170
Study guide: Exam FM-2
Fund J begins with a balance of 20,000 and earns an annual effective interest rate of 6.5%. At the end of each year, the interest earned and an additional 1000 is withdrawn from the fund so that by the end of the 20th year, the fund is depleted.
The annual withdrawals of interest and principal are deposited into Fund K, which earns an annual effective rate of 8.25%. At the end of the 20th year, the accumulated value of Fund K is X.
Calculate X.
- A) 39,332
- B) 54,818
- C) 84,593
- D) 86,902
- E) 97,631
Answer this question and see the worked solution