Q.Find the amount of an ordinary annuity of ₹ 3,200 per annum for 12 years at the rate of interest of 10% per year. $[(1.1)^{12} = 3.1384]$

$A=\dfrac{a}{i}\left[(1+i)^n-1\right]=\dfrac{3200}{0.10}(3.1384-1)=32000\times2.1384=\text{\u20b9}68{,}428.80$.

An ordinary-annuity future-value problem from the Financial Mathematics unit of the Tamil Nadu HSC Class-11 Business Mathematics syllabus.

Step 1 — Formula. The amount of an immediate (ordinary) annuity is

$A=\frac{a}{i}\big[(1+i)^n-1\big],$

where $a$ is the annual payment, $i$ the interest rate per period, $n$ the number of periods.

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