Actuarial Science 2053 Chapter Notes - Chapter 3: Egg Cell, Geometric Progression

• School: Western University
• Department: Actuarial Science
• Course: Actuarial Science 2053
• Professor: Steven Kopp

Document Summary

Suppose you deposit every 6-months for 2-years. 40-years? (80 payments in total) what is the accumulated value just after the 80th deposit (still at j2 = 6%). Back to our example n = 80, a = 500, r = 1. 03 > 1. The above is an example of an ordinary simple annuity. R = periodic payment of an annuity n = total number of interest periods during the term of an annuity i = interest rate per interest period. An ordinary simple annuity consisting of n-payments of . We denote the above sum by the symbol (read: s-angle-n-at-i) ins | 1( ins | = i n 1 i. This is called the accumulation factor for n- payments. If the ordinary simple annuity consisted of n-payments of , then the accumulated value is: ins | = r. You make semi-annual deposits of into a fund paying interest at j2 = 5%.