## 5.2 Modelling Annuity Investments using Tables

Note: if you cannot remember how to model reducing balance systems with regular repayments, revise notes for 5.1 Modelling Annuity Investments.

### Guidelines to use a Table for Annuity Investments

**Tables**provide a convenient method for analysing annuity investments, especially when there are regular systemic changes (e.g. the interest rate or repayments change regularly).- The columns of the table should list, the
**compounding period**,**payment**,**interest earned**,**principal addition**(i.e. the amount the system has increased during each compounding period) and the**balance**at the end of the compounding period. - The
**principal addition**can be calculated by as follows: