Compute the future value of $1,000 at an 8 percent interest rate 5, 10, and 15 y

Question

Compute the future value of $1,000 at an 8 percent interest rate 5, 10, and 15 years into the future. What would the future value be over these time horizons if the interest rate were 5 percent? Instructions: Enter your responses rounded to the nearest penny (two decimal places). Future value in 5 years at 8 percent $ Future value in 15 years at 8 percent- Future value in 10 years at 5 percent- Future value in 10 years at 8 percent- $ Future value in 5 years at 5 percent $ Future value in 15 years at 5 percent-$

Explanation / Answer

We use the formula:
A=P(1+r/100)^n
where
A=future value
P=present value
r=rate of interest
n=time period.

1.A=$1000*(1.08)^5

=$1000*1.469328077

=$1469.33(Approx)

2.

A=$1000*(1.08)^10

=$1000*2.158924997

=$2158.92(Approx)

3.

A=$1000*(1.08)^15

=$1000*3.172169114

=$3172.17(Approx).

4.

A=$1000*(1.05)^5

=$1000*1.276281563

=$1276.28(Approx).

5.

A=$1000*(1.05)^10
=$1000*1.628894627

=$1628.89(Approx).

6.

A=$1000*(1.05)^15

=$1000*2.078928179

=$2078.93(Approx).

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