How are the present value and future value related?
Answer to relevant QuestionsWould you prefer to have an investment earning 5 percent for 40 years or an investment earning 10 percent for 20 years? Explain. Show how the Rule of 72 can be used to approximate the number of years to quadruple an investment.A deposit of $350 earns the following interest rates:8 percent in the first year, 6 percent in the second year, and 5.5 percent in the third year. What would be the third year future value?Consider a $2,000 deposit earning 8 percent interest per year for five years. What is the future value, and how much total interest is earned on the original deposit vs. how much is interest earned on interest?What annual rate of return is earned on a $5,000 investment when it grows to $9,500 in five years?
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