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Sarah invested £12000 in a unit trust five years ago.
The value of the unit trust has increased by 7% per annum for each
of the last 3 years.
Before this, the price had decreased by 3% per annum.
Calculate the current price of the unit trust.
Give your answer to the nearest whole number of pounds.

Respuesta :

Answer:

13832 pounds

Step-by-step explanation:

For the first two years, the invested 12000 pounds lost its value by 3% per annum.

Therefore, after 2 years the value became [tex]12000(1 - \frac{3}{100})^{2} = 11290.8[/tex] pounds.

But, for the last three years, the value is increased by 7% per annum.

So, the final value of the investment becomes [tex]11290.8(1 + \frac{7}{100})^{3} = 13831.71[/tex] pounds ≈ 13832 pounds. (Answer)

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