Compute the future value of $2,000 compounded annually for 20 years at 9 percent

Question

Compute the future value of $2,000 compounded annually for 20 years at 9 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Future value $_________Compute the future value of $2,000 compounded annually for 15 years at 12 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Future value $_________Compute the future value of $2,000 compounded annually for 25 years at 9 percent. (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Future value $_________

Explanation / Answer

FV= PV(1+r)n

FV=Future Value=?

PV=Present Value= $2,000
r=rate of interest

N= no of years

FV= $2,000 ( 1+0.09)20

      =$2,000 x (1.09)20

                        =$2,000 x 5.60441

                          =$11,209

                 b. r=12% or 0.12, n=15

FV= $2,000 ( 1+0.12)15

      =$2,000 x (1.12)15

                        =$2,000 x 5.47357

                        =$10,947

                 c. r=9% or 0.09, n=25

FV= $2,000 ( 1+0.09)25

      =$2,000 x (1.09)25

                        =$2,000 x 8.62308

                        =$17,246

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