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## Homework Statement

hello this question is discussed in 2009 but it is closed now

If you invest £1000 on the first day of each year, and interest is paid at 5% on

your balance at the end of each year, how much money do you have after 25

years?

## Homework Equations

## S_N=\sum_{n=0}^{N-1} Ar^n##

where N is the last term

r is the common ratio & A is a constant

## S_N= a\frac{1-r^N}{1-r} ##

## The Attempt at a Solution

after 25 years i would set N=25 but this will give me a result of £47727. then i have to subtract £1000 because on the first day of each year i invest £1000 therefore i got a result of £46727

but this is the wrong answer

if i set N=26 i will get £51113 and then again subtract £1000

therefore i got a result of £50113 and this is the right answer

my question is why i must put N=26. isn't N the last term and equal to 25?

and is this way of solution right?