General formula for calculating accumulated amount based on average lowest balance concept
One of the ways to calculate dividend for an investment is by using average lowest balance (ALB) concept. The existing calculation of dividend based on ALB concept can only be done yearly. This paper discusses on the development of a general formula to calculate the accumulated amount for any period...
| Published in: | Pertanika Journal of Science and Technology |
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| Main Author: | |
| Format: | Article |
| Language: | English |
| Published: |
Universiti Putra Malaysia Press
2018
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| Online Access: | https://www.scopus.com/inward/record.uri?eid=2-s2.0-85041047616&partnerID=40&md5=96726b430f233238ba95bdf364846733 |
| Summary: | One of the ways to calculate dividend for an investment is by using average lowest balance (ALB) concept. The existing calculation of dividend based on ALB concept can only be done yearly. This paper discusses on the development of a general formula to calculate the accumulated amount for any period of time, based on the ALB concept that considers different yearly dividend rates. The patterns for each variable and coefficient for the calculated yearly accumulated amount were analysed. The general forms of each variable and coefficient were then combined to form the general formula for calculating the accumulated amount. Validity of the general formula is confirmed by calculating the percentage errors and proven by using mathematical induction. © 2018 Universiti Putra Malaysia Press. |
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| ISSN: | 01287680 |