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Future value

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P4-4 Future values For each of the cases shown in the following table, calculate the
future value of the single cash flow deposited today that will be available at the
end of the deposit period if the interest is compounded annually at the rate specified
over the given period.
Case Single cash flow Interest rate Deposit period (years)
A $ 200 5% 20yrs
B 4,500 8% 7yrs
C 10,000 9% 10yr
D 25,000 10% 12yr
E 37,000 11% 5yr
F 40,000 12% 9yr

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Solution Preview

A
Here we will find the Future value= $530.66
P=present value, F= Future value r= rate of interest n=duration
F=P*(1+r)^n, r=5%, n=20, P=$200

B
Here we will find the Future value= $7,712.21
P=present value, F= Future value r= rate of interest n=duration
F=P*(1+r)^n, r=8%, n=7, P=$4500

C
Here we will find the Future ...

Solution Summary

This explains the computation of Future value of money

$2.19
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