| Date | May 2010 | Marks available | 3 | Reference code | 10M.1.sl.TZ2.10 |
| Level | SL only | Paper | 1 | Time zone | TZ2 |
| Command term | Find | Question number | 10 | Adapted from | N/A |
Question
Astrid invests 1200 Euros for five years at a nominal annual interest rate of 7.2 %, compounded monthly.
Find the interest Astrid has earned during the five years of her investment. Give your answer correct to two decimal places.
Markscheme
\(I = 1200{\left( {1 + \frac{{7.2}}{{600}}} \right)^{5 \times 12}} - 1200\) (M1)(A1)
I = 518.15 Euros (A1) (C3)
Notes: Award (M1) for substitution in the compound interest formula, (A1) for correct substitutions, (A1) for correct answer.
If final amount found is 1718.15 and working shown award (M1) (A1)(A0).
[3 marks]
Examiners report
Part (a) of this question was incorrectly answered by many candidates not noticing that the rate of interest was compounded monthly rather than annually. A number of candidates gave the final amount as the answer, rather than the interest.
