Your grandmother just gave you $6,000 You'd like to see what it might grow to if...

 

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Your grandmother just gave you $6,000 You'd like to see what it might grow to if you invest it a. Calculate the future value of $6,000, given that it will be invested for 5 years at an annual interest rate of 2 percent b. Recalculate part a using a compounding period that is semiannual (every 6 months) c. Now let's look at what might happen if you can invest the money at an annual rate of 4 percent rather than 2 percent. Recalculate parts a and b for an annual interest rate of 4 percent d. Now let's see what might happen if you invest the money for 12 years rather than 5 years Recalculate part a using a time horizon of 12 years (annual interest rate is still 2 percent) Click on the table icon to view the FVIF table a. If you invest $6,000 for 5 years at 2% annually, the future value is $(Round to the nearest cent) Data table (Click on the following icon in order to copy its contents into a spreadsheet) Future Value of $1 (single amount), Future-Value Interest Factor 群 1% 2% 3% 4% 1 1.010 1.020 1.030 1.040 5% 1.050 2 1.020 1.040 1.061 1.002 1.103 3 1.030 1.061 1.093 1.125 95 10% 1.090 1.100 1188 1210 1295 1.331 4 1.041 1.002 1.126 5 1.051 1.104 1.159 6 1062 1.126 1.154 7 1072 1.149 1.230 B 1.083 1.172 1.267 9 1.094 1.195 10 1.105 11 1.116 12 13 1.138 1294 14 15 16 1173 17 1.184 18 $560 19 20 an example 21 22 1245 1546 3604 4.430 5437 6.659 6% 7% 15 11% 12% 76% 17% 18% 1.060 1070 1.080 1.110 1.120 1.130 1.140 1.150 1.160 1.170 1100 1.124 1145 1.166 1232 1254 1277 1.300 1323 1346 1369 1392 1416 1.158 1.191 1.225 1.260 1.368 1.405 1443 1.482 1521 1561 1602 1643 1.170 1216 1262 1311 1.360 1.412 1464 1518 1574 1630 1.689 1.749 1011 1.874 1.939 2.005 1217 1.276 1.338 1.403 1.469 1.539 1611 1.685 1762 1.842 1.925 2011 2.100 2 192 2208 2306 1265 1.340 1419 1.501 1587 1.677 1.772 1870 1.974 2.082 2.195 2.313 2.436 2.565 2.700 2.840 2986 1316 1.407 1.504 1606 1.714 1.828 1.949 2076 2211 2.353 2.502 2.660 2826 3001 3.185 3379 1.369 3583 1.477 1594 1.718 1.851 1993 2.144 2305 2476 2658 2.853 3059 3278 3511 3.759 4021 4.300 1.305 1423 1.551 1689 1.838 1.999 2172 2.358 2.558 2773 3.004 3.252 3510 3803 4108 4.435 4.785 5.160 1219 1.344 1.480 1629 1.791 1.967 2.159 2.367 2.594 2839 3.106 3.395 3.707 4.046 4.411 4.007 5234 5695 6192 1.243 1.354 1.539 1710 1.898 2.105 2.332 2.500 2853 3152 3479 3.836 4226 4652 5117 5624 6176 6.777 1.127 1268 1.426 1.601 1796 2012 2252 2.518 2013 3.138 3.490 3.896 4.335 4010 5.350 5936 1.469 1.665 1.886 2133 2.410 2.720 3.066 3452 3883 4.363 4.096 5492 6153 6.806 1.149 1319 1.513 1732 1980 2.261 2579 2.937 3342 3.797 4.310 4.807 5.536 6261 7.076 7560 1.161 1.346 1.558 1.801 2.079 2.397 2.759 3.172 3642 4.177 4.705 5.474 6254 7138 8137 9266 1373 1.605 1.873 2.183 2540 2.952 3426 3.970 4595 5311 6130 7.067 .137 $350 10.748 12.330 1.400 1.653 1.948 2292 2.693 3159 3.700 4320 5054 5895 6.866 7986 9216 1.196 1428 1.702 2.026 2.407 2854 3300 3.996 4717 1208 1.457 1.754 2107 2.527 3026 3617 4.316 5.142 6116 1.220 1.486 1.806 2.191 2653 3207 3870 4.661 5604 6727 1232 1.516 1.860 2.279 2.786 3.400 4.141 5.034 6.109 7400 1.916 2370 2.925 140 135 145 75% 195 20% 1.190 1.200 1.440 1.685 1728 2074 2.488 7430 6.580 7.200 8064 6916 7.699 9007 1.599 9596 10699 10 147 11420 12 839 10.539 11.974 13.590 15 407 14 129 16172 18408 10761 12.468 14.426 16.672 19.244 22 106 6544 7.690 9024 10 575 12.375 14463 16.079 19673 22.901 26623 7.263 613 10 197 12.056 14.232 16 277 19.748 23214 27 252 31948 8062 9.646 8.949 9934 11523 10 804 13743 13.021 15.668 18822 22574 27.034 16.367 19.461 23.106 27 393 12.100 14 714 17 861 21645 26.106 31629 32 324 38 142 32 429 38.597 38330 46.005 46971 Your grandmother just gave you $6,000 You'd like to see what it might grow to if you invest it a. Calculate the future value of $6,000, given that it will be invested for 5 years at an annual interest rate of 2 percent b. Recalculate part a using a compounding period that is semiannual (every 6 months) c. Now let's look at what might happen if you can invest the money at an annual rate of 4 percent rather than 2 percent. Recalculate parts a and b for an annual interest rate of 4 percent d. Now let's see what might happen if you invest the money for 12 years rather than 5 years Recalculate part a using a time horizon of 12 years (annual interest rate is still 2 percent) Click on the table icon to view the FVIF table a. If you invest $6,000 for 5 years at 2% annually, the future value is $(Round to the nearest cent) Data table (Click on the following icon in order to copy its contents into a spreadsheet) Future Value of $1 (single amount), Future-Value Interest Factor 群 1% 2% 3% 4% 1 1.010 1.020 1.030 1.040 5% 1.050 2 1.020 1.040 1.061 1.002 1.103 3 1.030 1.061 1.093 1.125 95 10% 1.090 1.100 1188 1210 1295 1.331 4 1.041 1.002 1.126 5 1.051 1.104 1.159 6 1062 1.126 1.154 7 1072 1.149 1.230 B 1.083 1.172 1.267 9 1.094 1.195 10 1.105 11 1.116 12 13 1.138 1294 14 15 16 1173 17 1.184 18 $560 19 20 an example 21 22 1245 1546 3604 4.430 5437 6.659 6% 7% 15 11% 12% 76% 17% 18% 1.060 1070 1.080 1.110 1.120 1.130 1.140 1.150 1.160 1.170 1100 1.124 1145 1.166 1232 1254 1277 1.300 1323 1346 1369 1392 1416 1.158 1.191 1.225 1.260 1.368 1.405 1443 1.482 1521 1561 1602 1643 1.170 1216 1262 1311 1.360 1.412 1464 1518 1574 1630 1.689 1.749 1011 1.874 1.939 2.005 1217 1.276 1.338 1.403 1.469 1.539 1611 1.685 1762 1.842 1.925 2011 2.100 2 192 2208 2306 1265 1.340 1419 1.501 1587 1.677 1.772 1870 1.974 2.082 2.195 2.313 2.436 2.565 2.700 2.840 2986 1316 1.407 1.504 1606 1.714 1.828 1.949 2076 2211 2.353 2.502 2.660 2826 3001 3.185 3379 1.369 3583 1.477 1594 1.718 1.851 1993 2.144 2305 2476 2658 2.853 3059 3278 3511 3.759 4021 4.300 1.305 1423 1.551 1689 1.838 1.999 2172 2.358 2.558 2773 3.004 3.252 3510 3803 4108 4.435 4.785 5.160 1219 1.344 1.480 1629 1.791 1.967 2.159 2.367 2.594 2839 3.106 3.395 3.707 4.046 4.411 4.007 5234 5695 6192 1.243 1.354 1.539 1710 1.898 2.105 2.332 2.500 2853 3152 3479 3.836 4226 4652 5117 5624 6176 6.777 1.127 1268 1.426 1.601 1796 2012 2252 2.518 2013 3.138 3.490 3.896 4.335 4010 5.350 5936 1.469 1.665 1.886 2133 2.410 2.720 3.066 3452 3883 4.363 4.096 5492 6153 6.806 1.149 1319 1.513 1732 1980 2.261 2579 2.937 3342 3.797 4.310 4.807 5.536 6261 7.076 7560 1.161 1.346 1.558 1.801 2.079 2.397 2.759 3.172 3642 4.177 4.705 5.474 6254 7138 8137 9266 1373 1.605 1.873 2.183 2540 2.952 3426 3.970 4595 5311 6130 7.067 .137 $350 10.748 12.330 1.400 1.653 1.948 2292 2.693 3159 3.700 4320 5054 5895 6.866 7986 9216 1.196 1428 1.702 2.026 2.407 2854 3300 3.996 4717 1208 1.457 1.754 2107 2.527 3026 3617 4.316 5.142 6116 1.220 1.486 1.806 2.191 2653 3207 3870 4.661 5604 6727 1232 1.516 1.860 2.279 2.786 3.400 4.141 5.034 6.109 7400 1.916 2370 2.925 140 135 145 75% 195 20% 1.190 1.200 1.440 1.685 1728 2074 2.488 7430 6.580 7.200 8064 6916 7.699 9007 1.599 9596 10699 10 147 11420 12 839 10.539 11.974 13.590 15 407 14 129 16172 18408 10761 12.468 14.426 16.672 19.244 22 106 6544 7.690 9024 10 575 12.375 14463 16.079 19673 22.901 26623 7.263 613 10 197 12.056 14.232 16 277 19.748 23214 27 252 31948 8062 9.646 8.949 9934 11523 10 804 13743 13.021 15.668 18822 22574 27.034 16.367 19.461 23.106 27 393 12.100 14 714 17 861 21645 26.106 31629 32 324 38 142 32 429 38.597 38330 46.005 46971

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