Question 1

Paper 2Easy6 marks

At the beginning of year 1, a savings account contains 6000.Atthebeginningofeachfollowingyear,6000. At the beginning of each following year,500 is added to the account. The account pays simple interest at 4% per year on the amount deposited. Interest is withdrawn at the end of each year and is not added to the amount on which interest is calculated.

(a)

Calculate the interest earned in year 2.

[1]
(b)

State the first term and the common difference of the sequence of annual interest amounts.

[2]
(c)

Hence, write the total interest earned over the first 6 years using sigma notation, and calculate this total.

[3]

More AI 1.2 Sequences and financial mathematics questions