Question

Compute the future value of $1,000 compounded annually for 10 years at 9 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) b. Compute the future value of $1,000 compounded annually for 10 years at 12 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) c. Compute the future value of $1,000 compounded annually for 15 years at 9 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)

Answer 1

Answer:

a.$ 2,367.36

b.$ 3,105.85

c.$ 3,642.48  

Explanation:

The future value formula applicable in all the three cases is stated thus:

FV=PV*(1+r)^n

PV is the amount today which is $1000 in all cases

r is the rate of interest (i.e 9%,12% and 9%)

n is the time the amount is invested( i.e 10,10 and 15 years)

FV=1,000*(1+9%)^10=$ 2,367.36  

FV=1000*(1+12%)^10=$ 3,105.85  

FV=1000*(1+9%)^15=$ 3,642.48