Find the future value, using the future value formula and a calculator. (Round your answer to the nearest cent.)
$990 at 5.5% compounded quarterly for 3 years
Find the present value, using the present value formula and a calculator. (Round your answer to the nearest cent.)
Achieve $225,500 at 8.55% compounded continuously for 8 years, 155 days.
thank you
just solve for p in
p(1+.055/4)^(4*3) = 990
8y 155d = 8.43 years, so
p*e^(.0855*8.43) = 225500
To find the future value using the future value formula and a calculator, we can use the following formula:
FV = PV * (1 + r/n)^(n*t)
Where:
- FV is the future value
- PV is the present value
- r is the annual interest rate (expressed as a decimal)
- n is the number of compounding periods per year
- t is the number of years
For the first question, we have:
- PV = $990
- r = 5.5% = 0.055 (as a decimal)
- n = 4 (quarterly compounding)
- t = 3 years
Plugging these values into the formula, we get:
FV = $990 * (1 + 0.055/4)^(4*3)
Using a calculator, evaluate the expression to get the future value. Round your answer to the nearest cent.
For the second question, to find the present value using the present value formula and a calculator, we can use the following formula:
PV = FV / e^(r*t)
Where:
- PV is the present value
- FV is the future value
- r is the annual interest rate (expressed as a decimal)
- t is the time in years
For the second question, we have:
- FV = $225,500
- r = 8.55% = 0.0855 (as a decimal)
- t = 8.47 years (8 years, 155 days converted to years)
Plugging these values into the formula, we get:
PV = $225,500 / e^(0.0855*8.47)
Using a calculator, evaluate the expression to get the present value. Round your answer to the nearest cent.