Question 1
A village estimates ₦1,049,740.00 for a water project. The sum of ₦400,000.00 is realised through communal donation and deposited in a bank at a compound interest of per annum. If the village chief adds ₦100,000.00 to the amount in the account at the end of each year, how long will it take to realise the estimate?
- (a)
Number of years
Worked solution (try it first)
(a)
- Work year by year: add interest (× 1.1), then the chief's ₦100,000.
- End of year 1: .
- Year 2: .
- Year 3: .
- Year 4: .
- The estimate of ₦1,049,740 is reached after 4 years.