Conceptual Overview: Explore how interest, payment, and number of periods determine the future value of an ordinary annuity.

1. What is the approximate future value of an annuity after 10 years with payments each period of $200, and an interest rate of 6%?

1. $1,257.59
2. $2,515.58
3. $2,636.16
4. $3,187.48

2. Set the sliders so that the interest rate is 5%, the payment is $100, and the number of periods is 3. If the interest rate doubles from 5% to 10%, the future value of the annuity:

1. Increases but by less than double
2. Exactly doubles
3. Increases by more than double
4. Cannot be determined

3. Again, set the sliders so that the interest rate is 5%, the payment is $100, and the number of periods is 3. If the payment doubles from $100 to $200, the future value of the annuity:

1. Increases but by less than double
2. Exactly doubles
3. Increases by more than double
4. Cannot be determined

4. Again, set the sliders so that the interest rate is 5%, the payment is $100, and the number of periods is 3. If the number of periods doubles from 3 to 6, the future value of the annuity:

1. Increases but by less than double
2. Exactly doubles
3. Increases by more than double
4. Cannot be determined

FVAN=PMT[I(1+lN1]=$100[0.050(1+0.050)31)]=$315.25