Math Problem Statement
Linda-Anne inherits R31940 which she immediately invests at 15% p.a., compounded quarterly. She starts withdrawing R791 every three months from the account the first withdrawal three months after making the investment. From the 2nd withdrawal onwards, she starts consecutively decreasing each withdrawal by 6% (the 2nd withdrawal is already less than the 1st withdrawal). What will the balance in the account be after 7 years, immediately after making that withdrawal? Round off to two decimals only right at the end.
Solution
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Math Problem Analysis
Mathematical Concepts
Compound Interest
Decreasing Geometric Sequence
Periodic Withdrawals
Formulas
Compound interest formula: A = P(1 + r/n)^(nt)
Geometric sequence formula: a_n = a_1 * r^(n-1)
Account balance after withdrawals: A = P(1 + r/n)^(nt) - Withdrawals
Theorems
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Suitable Grade Level
College-level or advanced high school math
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