Question

If you invest $17,000 today, how much will you have in each of the following cases? Enter all answers as positive amounts.

a. In 6 years at 7 percent? (Round your final answer to 2 decimal places.)

b. In 20 years at 9 percent? (Round your final answer to 2 decimal places.)

c. In 10 years at 12 percent (compounded semiannually)? (Round your final answer to 2 decimal places.)

Answer 1

a.We use the formula:
A=P(1+r/100)^n
where
A=future value
P=present value
r=rate of interest
n=time period.

=$17000*(1.07)^6

=$17000*1.500730352

=$25512.42(Approx).

b.We use the formula:
A=P(1+r/100)^n
where
A=future value
P=present value
r=rate of interest
n=time period.

=$17000*1.09^20

=$17000*5.604410768

=$95274.98(Approx).

cWe use the formula:
A=P(1+r/200)^2n
where
A=future value
P=present value
r=rate of interest
n=time period.

A=17000(1+0.12/2)^(2*10)

=17000*3.207135472

=$54521.30(Approx).