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At an interest rate of 8%, we calculate that $10,000 five years from now will be: a. FV = PV * (1 + r) N
At an interest rate of 8%, we calculate that $10,000 five years from now will be:
a. FV = PV * (1 + r)N = ($10,000)*(1.08)5 = ($10,000)*(1.469328) FV = $14,693.28 | ||
b. PV = FV * (1/(1 + r)N) = ($10,000)*(1/(1.08)50 =($10,000)*(1/(1.469328)) PV = ($10,000)*(0.680583) = $6805.83 | ||
c. FV = PV * (1 + r)N = ($10,000)*(1.08)5 = ($10,000)*(1.324512) FV = $13245.12 | ||
d. PV = FV * (1/(1 + r)N) = ($10,000)*(1/(1.08)^5 =($10,000)*(1/(1.469328)) PV = ($10,000)*(0.184383) = $6234.83 |
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