1. **Problem Statement:** Suzana has RM26,442 from an educational insurance matured value. She has two options for her 4-year university studies: - Option 1: Invest RM26,442 at 4.25% annual interest compounded monthly and receive monthly payments for 4 years. - Option 2: Receive a fixed RM560 every month for 4 years from her parents. 2. **Formula Used:** The monthly payment from an investment compounded monthly is given by: $$\text{PMT} = P \times \frac{r(1+r)^n}{(1+r)^n - 1}$$ where: - $P = 26442$ (principal) - $r = \frac{0.0425}{12} = 0.0035417$ (monthly interest rate) - $n = 48$ (number of months) 3. **Calculate $(1+r)^n$:** $$ (1 + 0.0035417)^{48} = (1.0035417)^{48} $$ Using a calculator, this is approximately: $$ 1.1856 $$ 4. **Calculate numerator:** $$ r(1+r)^n = 0.0035417 \times 1.1856 = 0.004198 $$ 5. **Calculate denominator:** $$ (1+r)^n - 1 = 1.1856 - 1 = 0.1856 $$ 6. **Calculate monthly payment (PMT):** $$ \text{PMT} = 26442 \times \frac{0.004198}{0.1856} = 26442 \times 0.02262 = 598.5 $$ 7. **Interpretation:** - Option 1 yields approximately RM598.5 per month. - Option 2 offers RM560 per month. 8. **Conclusion:** Suzana should choose Option 1 because RM598.5 > RM560, meaning she will receive more money monthly by investing the insurance money at 4.25% compounded monthly.