3. A deposit of ___(i)___is made into an account paying an interest rate of 5% compounded annually. How many annual payments of ___(iii)___can be made from this account?
a) (i)$100,000 (ii)$10,000
b) (i)$200,000 (ii)$20,000
c) (i) 10x (ii) x
d) (i) 10x (ii) x at r% compounded continuously
To find the number of annual payments that can be made from the account, we need to divide the initial deposit by the annual payment amount.
First, we need to determine the values of (i) and (iii) from the options provided:
a) (i)$100,000 (ii)$10,000
b) (i)$200,000 (ii)$20,000
c) (i) 10x (ii) x
d) (i) 10x (ii) x at r% compounded continuously
Since the deposit is given as (i), and the annual payment is given as (iii), we need to choose the option that matches these variables.
In this case, option b) fits the variables:
(i) $200,000 and
(iii) $20,000
Now, we can find the answer by dividing the initial deposit by the annual payment amount:
Number of annual payments = (i) / (iii)
= $200,000 / $20,000
= 10 payments
Therefore, the answer is 10 annual payments.