Question

  

Determine the future value of $19,000 under each of the following sets of assumptions (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1 (Use appropriate factor(s) from the tables provided. Round your final answers to nearest whole dollar amount.): Annual Rate Period Invested i= n= Future Value Value 10% 1. 2. Interest Compounded Semiannually Quarterly Monthly 8 years 2 years 15 months 12% 36% $ $ $ 19,000 19,000 19,000 3.

Answer 1

Determination of Future value (FV):

FV = Present value (PV) × (1+i)ⁿ

Where "i" is Interest rate, "n" is no of periods.

	Annual rate	Period invested	Interest compounded	"i"	"n"	PV	FV
1	10%	8 years	Semi annually	10%(1/2) = 5%	8 years × 2 = 16 periods	$ 19,000	$19,000×(1+0.05)16 = $ 19,000 × 2.1829 = $ 41,475 ​​​​
2	12%	2 years	Quarterly	12% (1/4) = 3%	2 years × 4 = 8 periods	$ 19,000	$19,000×(1+0.03)8 = $ 19,000×1.2268 = $ 23,309
3	36%	15 months	Monthly	36%(1/12) = 3%	15 periods	$ 19,000	$19,000×(1+0.03)15 = $ 19,000×15580 = $ 29,602

"i" is interest rate for the period.