You have $4,000 to invest for the next 45 years. You are offered an investment plan that will pay...
Question:
You have $4,000 to invest for the next 45 years.
You are offered an investment plan that will pay you 5% per year for the next 10 years and 12% per year for the last 35 years.
How much will you have at the end of the 45 years?
Future Value:
Future value is the compounded value of the current value or the present value. It is calculated to find out the money we will have after a certain point of time. It is the increased value as per the time value of money approach.
Answer and Explanation: 1
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View this answerFuture Value = Present Value x (1 + Rate)^Number of years
In the given question,
Rates are different for two sets of years so we will have to...
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How to Calculate Future Value: Formula & Example
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Chapter 5 / Lesson 16
40K
Understand the definition of future value and the future value formula. Explore some examples that show how to calculate the future value of an investment.
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