The $$105$ one$-$time cash flow that your bank credits to your account in one year is known as a future value $(FV{?}_{(}))$ of $$100$ in one year at a $5$ percent annual interest rate. If interest rates were higher than $5$ percent, then the future value of your $$100$ would also be higher. If you left your money in the bank for more than one year, then its future value would continue to grow over time. Let's see why.

TABLE $4\mathrm{.}1$ Higher Interest Rates and Cash Flows Lead to Higher Future Values

$\backslash$table$[[,$A$,$B$,$C$,$D$],[1,$Higher Interest Rates Lead to Higher Future Values$],[2,$Today's Cash Flow,Interest Rate,Interest Earned,$\backslash$table$[[$Next Year's Future$],[$Value$]]],[3,$$$100\mathrm{.}00,5\%,$$$5\mathrm{.}00,$$$105\mathrm{.}00],[4,$$$100\mathrm{.}00,6\%,$$$6\mathrm{.}00,$$$106\mathrm{.}00],[5,$$$15,000\mathrm{.}00,5\%,$$$750\mathrm{.}00,$$$15,750\mathrm{.}00],[6,$$$15,000\mathrm{.}00,6\%,$$$900\mathrm{.}00,$$$15,900\mathrm{.}00],[7,,,,],[8,$Higher Cash Flows Today Lead to Higher Future Values$],[9,$Today's Cash Flow,Interest Rate,Interest Earned,$\backslash$table$[[$Next Year's Future$],[$Value$]]],[10,$$$500\mathrm{.}00,7\mathrm{.}50\%,$$$37\mathrm{.}50,$$$537\mathrm{.}50],[11,$$$750\mathrm{.}00,7\mathrm{.}50\%,$$$56\mathrm{.}25,$$$806\mathrm{.}25]]$