2. Calculating Future Values Compute the future value of $1,000 compounded annua

Question

2.
       
        Calculating Future Values Compute the future value of $1,000 compounded annually for
       
         
           
              a.
           
            10 years at 5 percent.
         
         
           
              b.
           
            10 years at 10 percent.
         
         
           
              c.
           
            20 years at 5 percent.
         
         
           
              d.
           
            Why is the interest earned in part (c) not twice the amount earned in part (a)?

Explanation / Answer

2)

a)P=1000(1+0.05)^10=$1628.89

b)P=1000(1+0.1)^10=$2593.74

c)P=1000(1+0.05)^20=$2653.29

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