Question

John bought a ring for his friend for $3200. He expects it to appreciate 3.5% each year. How much will the ring be worth in 4 years?

Answer 1

Answer:

FV= $3,672.07

Step-by-step explanation:

Giving the following information:

Present Value (PV)= $3,200

Number of periods (n)= 4 years

Appreciation rate= 3.5% = 0.035

To calculate the price of the ring in four years, we need to use the following formula:

FV= PV*(1 + i)^n

FV= 3,200*(1.035^4)

FV= $3,672.07