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2. Future Value of a Lump Sum : If you invest $1,200 today at this 7.2% nominal interest rate, what would your investment be worth

2. Future Value of a Lump Sum: If you invest $1,200 today at this 7.2% nominal interest rate, what would your investment be worth under the various compounding periods in 4 year? Show the return components for the future value in 4 years. Use the effective rates in your calculations.

Inputs

Nominal Rate

7.2000%

Cashflow per year

$1,200.00

Holding Period

4 years

Q2: Future Value Lump Sum

Compounding

Effective

Rate

Future

Value

Return of Principal

Total

Interest

Regular

Interest

Interest on Interest

Annual

Semi-annual

Quarterly

Monthly

Daily

Continuous

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