SOLUTION: I am attempting to solve a finance annuity equation. n=10 i =.03 in the formula= 1-(1.03)^-10 /.03 the answer is 8.53020 I am doing something wrong in the order of operations an

Algebra ->  Finance -> SOLUTION: I am attempting to solve a finance annuity equation. n=10 i =.03 in the formula= 1-(1.03)^-10 /.03 the answer is 8.53020 I am doing something wrong in the order of operations an      Log On


   

Question 291122: I am attempting to solve a finance annuity equation. n=10 i =.03
in the formula= 1-(1.03)^-10 /.03 the answer is 8.53020 I am doing something wrong in the order of operations and cannot figure it out. I appreciate seeing the problem solutiion stepped. Thank you. the formula is 1-(1+i)^-n/i
Answer by jim_thompson5910(35256) About Me  (Show Source):
You can put this solution on YOUR website!
Is the formula %281-%281%2Bi%29%5E%28-n%29%29%2Fi? If so, then


%281-%281%2Bi%29%5E%28-n%29%29%2Fi Start with the given expression.


%281-%281%2B0.03%29%5E%28-10%29%29%2F0.03 Plug in n=10 and i=0.03


%281-%281.03%29%5E%28-10%29%29%2F0.03 Add 1 to 0.03 to get 1.03


%281-1%2F%281.03%29%5E%2810%29%29%2F0.03 Rewrite %281.03%29%5E%28-10%29 as 1%2F%281.03%29%5E%2810%29


%281-1%2F1.34391638%29%2F%280.03%29 Raise 1.03 to the 10th power to get 1.34391638 (which is approximate).


%281-0.744093915%29%2F%280.03%29 Divide 1 into 1.34391638 to get 0.744093915 (which is again approximate)


%280.255906085%29%2F%280.03%29 Subtract


8.53020283 Divide


So the answer is approximately 8.53020283 which means that %281-%281%2B0.03%29%5E%28-10%29%29%2F0.03=8.53020283 (approximately).


Consequently, this means that %281-%281%2Bi%29%5E%28-n%29%29%2Fi=8.53020283 (approximately) when n=10 and i=0.03