MA170 Lecture Notes - Lecture 8: Linear Interpolation
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Similar idea for a). (d) final payment is y and takes place on (cid:98)n(cid:99) + 1 = (cid:100)n(cid:101). , when solving sni = k n k. Jm = j% + (cid:19) (cid:18) k k1 k2 k1. An annuity where payments are made more or less frequently than interest is compounded. There are two methods used to deal with such annuities: change of rate. Replace the given interest rate by an equivalent rate that"s compounded the same time as payments are made. To do this, recall that to rates jm and jn are equivalent if they have the same e ect on money over the same period of time. Note: when determining the rate do not round the value - use the entire decimal value obtained by your calculator. Round only your nal answer: change of payment: Replace a given sequence of payments by equivalent payments made on the interest conversion dates.
