SOA Exam FM Sample Question 207
Study guide: Exam FM-2
An investor deposited 1000 in each of Bank X and Bank Y. Bank X credits simple interest at an annual rate of 10% for the first five years and 7% thereafter. Bank Y credits interest at an annual nominal rate of 5% compounded quarterly. The interest credited in the eighth year by Bank Y exceeds the interest credited in the eighth year by Bank X by N.
Calculate the absolute value of N.
- A) 0.36
- B) 2.14
- C) 20.00
- D) 56.36
- E) 56.93
Answer this question and see the worked solution