4. Ch04 Financial Planning Exercise 7 eBook Chapter 4 Financial Planning Exercise 7 Calculating interest earned and future value of savings account If you put $6,000 in a savings account that pays interest at the rate of 7 percent, compounded annually, a. how much will you have in six years? Round the answer to the nearest cent. Round FV-factor to three decimal places or use the Appendix A. (Hint: Use the future value formula.) $ b. how much interest will you earn during the six years? Round the answer to the nearest cent. $ c. If you put $6,000 at the end of each year into a savings account that pays interest at the rate of 7 percent a year, how much would you have after six years? Use the Appendix B. Round the answer to the nearest cent. Round FV-factor to three decimal places. $ Grade it Now Save & Continue Continue without saving Instructions: To use this table, find the future value factor that corresponds to both a given time period (year) and an interest rate. For example, if you want the future value factor for 6 years and 10%, move across from year 6 and down from 10% to the point at which the row and column intersect: 1.772. Other illustrations: for 3 years and 15%, the proper future value factor is 1.521; for 30 years and 8%, it is 10.063. INTEREST RATE Period 1% 1 1.010 2% 1.020 3% 1.030 4% 5% 1.040 1.050 1.060 6% 7% 8% 9% 2 1.020 1.040 1.061 3 1.030 1.061 1.093 1.125 1.158 1.082 1.103 1.124 1.191 1.145 1.070 1.080 1.166 1.188 10% 11% 12% 13% 14% 15% 1.090 1.100 1.110 1.120 1.130 1.140 1.150 1.210 1.232 1.254 1.277 1.300 1.323 16% 17% 18% 1.160 1.170 1.180 1.346 1.369 1.392 19% 20% 25% 30% 1.190 1.200 1.250 1.300 1.416 1.440 1.563 1.690 1.225 1.260 1.295 1.331 1.368 1.405 1.443 1.482 1.521 1.561 1.602 1.643 1.685 1.728 1.953 2.197 4 1.041 1.082 1.126 1.170 1.216 1.262 1.311 5 1.051 1.104 1.159 1.217 1.276 1.338 1.403 1.360 1.412 1.469 6 1.062 1.126 1.194 1.265 1.340 1.419 1.501 1.587 1.677 1.464 1.518 1.574 1.630 1.539 1.611, 1.685 1.762 1.842 1.772 1.870 1.974 2.082 7 1.072 1.149 1.230 1.316 1.407 1.504 1.606 1.714 1.828 1.949 2.076 2.211 2.353 2.502 1.689 1.749 1.811 1.925 2.011 2.100 2.192 2.288 2.195 2.313 2.436 2.565 2.660 2.826 3.001 3.185 1.874 1.939 2.005 2.074 2.441 2.856 2.386 2.488 3.052 3.713 2.700 2.840 2.986 3.815 4.827 3.379 3.583 4.768 6.275 8 1.083 1.172 1.267 1.369 1.477 1.594 1.718 1.851 1.993 9 1.094 1.195 1.305 1.423 1.551 1.689 1.838 1.999 2.144 2.305 2.476 2.172 2.358 2.558 2.773 2.658 2.853 3.059 3.278 3.511 3.759 4.021 4.300 5.960 8.157 3.004 3.252 3.518 3.803 4.108 4.435 4.785 5.160 7.451 10.604 10 1.105 1.219 11 1.116 12 1.127 1.344 1.480 1.243 1.384 1.539 1.268 1.426 1.601 1.629 1.791 1.710 1.898 1.796 2.012 1.967 2.159 2.105 2.332 2.252 2.367 2.594 2.580 2.853 2.839 3.106 3.152 3.479 3.395 3.707 4.046 4.411 4.807 5.234 3.836 4.226 4.652 5.117 5.624 6.176 5.695 6.192 9.313 13.786 6.777 7.430 11.642 17.922 2.518 2.813 3.138 3.498 3.896 4.335 4.818 5.350 5.936 6.580 7.288 8.064 8.916 14.552 23.298 13 1.138 14 1.149 1.319 1.513 15 16 1.161 1.173 17 18 1.196 19 1.208 1,294 1.469 1.665 1.886 2.133 1.732 1.980 1.346 1.558 1.801 2.079 2.397 1.373 1.605 1.873 2.183 2.540 1.184 1.400 1.428 1.702 2.026 2.407 2.854 1.457 1.754 2.261 2.410 2.720 2.579 2.937 3.066 3.452 3.342 3.797 3.883 4.363 4.310 4.887 4.898 2.759 3.172 3.642 2.952 3.426 1.653 1.948 2.292 2.693 3.159 3.700 3.380 3.996 2.107 2.527 3.026 3.617 4.316 20 1.220 21 1.232 2.279 22 23 24 25 1.282 1.641 2.094 2.666 3.386 4.292 26 1.295 1.673 2.157 2.772 3.556 4.549 27 1.308 1.707 2.221 2.883 3.733 4.822 28 1.321 29 1.335 30 1.348 1.776 2.357 1.811 2.427 3.119 3.243 1.741 2.288 2.999 3.920 5.112 4.116 5.418 4.322 5.743 1.486 1.806 2.191 1.516 1.860 1.245 1.546 1.916 2.370 2.925 3.604 4.430 5.437 1.257 1.577 1.974 2.465 3.072 3.820 4.741 5.871 1.270 1.608 2.033 2.563 3.225 4.049 5.072 6.341 5.427 6.848 5.807 7.396 9.399 11.918 15.080 19.040 7.988 10.245 13.110 16.739 8.627 11.167 14.421 18.580 23.884 7.114 9.317 12.172 15.863 20.624 26.750 7.612 10.063 13.268 17.449 22.892 29.960 4.661 5.311 6.130 5.054 5.895 6.866 5.560 6.544 7.690 5.142 6.116 7.263 8.613 2.653 3.207 3.870 5.604 6.727 8.062 9.646 2.786 3.400 4.141 5.034 6.109 7,400 8.949 10.804 6.659 8.140 9.934 12.100 8.954 11.026 13.552 9.850 12.239 15.179 8.623 10.835 13.585 3.970 4.177 4.785 5.474 4.595 6.254 5.492 6.153 6.886 7.699 8.599 5.535 6.261 7.076 7.988 9.007 10.147 7.138 8.137 9.266 10.539 11.974 9.596 10.699 18.190 30.288 11.420 12.839 22.737 39.374 4.328 4.717 7.258 7.911 17.000 6.214 21.325 6.649 35 1.417 2.000 2.814 3.946 5.516 7.686 10.677 14.785 20.414 28.102 38.575 52.800 72.069 98.100 133.176 180.314 243.503 327.997 1489 2.208 3262 4.801 7.040 10.286 14.974 21.725 31.409 45 259 65.001 93.051 13.590 15.407 7.067 8.137 9.358 10.748 12.330 14.129 16.172 7.986 9.276 10.761 12.468 14.426 16.672 19.244 22.186 9.024 10.575 12.375 14.463 16.879 19.673 22.901 10.197 12.056 14.232 16.777 19.748 23.214 27.252 31.948 69.389 146.192 11.523 13.743 16.367 19.461 23.106 27.393 32.429 38.338 86.736 190.050 13.021 15.668 18.822 22.574 27.034 32.324 38.591 46.005 108.420 247.065 14.714 17.861 21.645 26.186 31.629 38.142 45.923 55.206 135.525 321.184 16.627 20.362 24.891 30.376 37.006 45.008 54.649 66.247 169.407 417.539 18.788 23.212 28.625 35.236 43.297 53.109 65.032 79.497 211.758 542.801 21.231 26.462 32.919 40.874 50.658 62.669 77.388 95.396 264.698 705.641 23.991 30.167 37.857 47.414 59.270 73.949 114.475 330.872 917.333 27.109 34.390 43.535 55.000 69.345 87.260 137.371 413.590 1,192.533 30.633 39.204 50.066 63.800 81.134 102.967 164.845 516.988 1,550.293 34.616 44.693 57.575 74.009 94.927 121.501 197.814 646.235 2,015.381 39.116 50.950 66.212 85.850 111.065 143.371 237.376 807.794 2,619.996 590.668 2,465.190 9,727.860 132 782 188 884 267 864 378 721 533 869 750 378 1051 668 1469 772 7.523 164 36 118 865 28.422 51.186 18.488 35.527 66.542 44.409 86.504 26.623 55.511 112.455 92.092 109.589 130.411 155.189 184.675 440.701