I. For a $10,000 investment, what is the future value if it earns 10% interest f

Question

I. For a $10,000 investment, what is the future value if it earns 10% interest for one year? (5pts) The year is 2020. You are the recipient of $10,000 that was left for you from a family member. What was the PV of the investment when it was deposited 5 years ago at 8% interest? (5pts) 2. 3. To become a millionaire at the age of 70, how much money will you need to invest now at an interest rate of 5 percent? (5pts) 4. How much interest is earned from question 3? (5pts) 5" You have S500.00 in your savings account and it has a 5% interest rate, what will is the FV in 10 years considering you never spend a penny and the interest rate stays the same? (5pts)

Explanation / Answer

1 FV = PV(1+r)n Fv= 10000(1+.1)1 FV= 11000 2 Fv= 10000(1+.08)5 FV = 10000*1.49 Value = $ 14693 5 FV= 500(1+.1)10 Fv = 500*2.59 FV = $ 1297

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