Spreadsheet Solution: Use formulas to find your answer by completing the FV Table: Today 0.08 Year 1 0.08 Year 2 0.08 a Interest Rate b Time c Cash Flow d FV interest factor e Future Value 1 100 '2 200 Year 3 0.08 2 Then, we find the FV of each cash flow in row e. 3 200 Year 4 0.08 200 3 Lastly, we sum the FVs to get the FV of the annuity in cell J34. In cell J34 enter the formula: = sum(E34:134) Year 5 0.08 1 First we must calculate the FV Interest Factor for each cash flow in row d. FVIF = (1+r)-t In cell E33 enter the formula: = (1+E30)^4 and copy to cells G33 and H33 You must change the exponents in cells F33 through 133. 518 Solution 4 Your answer should be: The FV of the cash flows is $1355.27 Note: You can change any of the inputs and Excel will automatically recompute. In cell E34 enter the FV formula:CF x FVIF =E32*E33 and copy to cells F34 through I 34

Use formulas to find your answer by completing the FV Table: 1 First we must calculate the FV Interest Factor for each cash flow in row d. FVIF =(1+r)at In cell E33 enter the formula: =(1+E30)4 and copy to cells G33 and H33 You must change the exponents in cells F33 through 133. 2 Then, we find the FV of each cash flow in row e. In cell E34 enter the FV formula:CF x FVIF = E32 E33 and copy to cells F34 through I 34 3 Lastly, we sum the FVs to get the FV of the annuity in cell 334. In cell J34 enter the formula: = sum(E34:I34) 4 Your answer should be: The FV of the cash flows is $1355.27 Note: You can change any of the inputs and Excel will automatically recompute