CFA Practice Question

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CFA Practice Question

You are trying to accumulate $5,000 in a savings account. The savings account pays 4% per year and you plan to make yearly deposits of $416.45 at the end of each year. How many yearly deposits must you make?

A. 10
B. 12
C. 15
Correct Answer: A

By calculator: PMT = -$416.45; i = 4%; FV = $5,000.00; CPT n = 10

User Contributed Comments 7

User Comment
irutschka My calculator somehow gives 8 as an answer. Anybody has the same?
irutschka Sorry, everything is fine with 10 ;))
cptp I got 9.68, hence 10 is correct.
airborne the answer is 10.0001 everything is OK
Bevin Don't forget to put END in your calculator. I forgot the first time and got 9.68. Once I changed, I got 10.
swinter44 If you're having trouble coming up with the correct answer, check to ensure that you don't have P/Y set to a number other than 1 from a previous question.
uhupong Good reminding Bevin.

Those who set cal with BEG and got 9.68 just got lucky this time.
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