Question

1. How much would $2,000 become in 10 years at 5% interest?

2. How much would $2,000 deposits each year for 10 years at 5% become in 10 years?

3. How much money would you have to have on deposit today at a 5% annual interest rate to become $50,000 in 40 years?

4. How much money would you have to have on deposit to provide $30,000 each year for 25 years (considering 5% interest)?

Answer #1

1. |
Future Value | =fv(rate,nper,pmt,pv) | |

= $
3,257.79 |
|||

Where, | |||

rate | = | 5% | |

nper | = | 10 | |

pmt | = | 0 | |

pv | = | $ -2,000 | |

2. |
Future Value | =fv(rate,nper,pmt,pv) | |

= $
25,155.79 |
|||

Where, | |||

rate | = | 5% | |

nper | = | 10 | |

pmt | = | $ -2,000 | |

pv | = | 0 | |

3. |
Present Value | =-pv(rate,nper,pmt,fv) | |

=
$7,102.28 |
|||

Where, | |||

rate | = | 5% | |

nper | = | 40 | |

pmt | = | 0 | |

fv | = | $ 50,000 | |

4. |
Present Value | =-pv(rate,nper,pmt,fv) | |

= $
422,818.34 |
|||

Where, | |||

rate | = | 5% | |

nper | = | 25 | |

pmt | = | $ 30,000.00 | |

fv | = | 0 |

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10% Interest
EOY Total
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2000
$ 2,200.00
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