Saving Money: Future value of an investment when we save money in an account, we typically deposit it with some account that will givee Us a percent interest. If we put a dollar into g piggy bank and never touch it again, in a yedr IT will sfill only be one dollar. If we put a dollar into a savings account that is awarding us interest then that dollar could turn into $1.50 in a year, How much we gain is based on the Interest and the compounding period. Compounding period refers to how often the interest IS calculated on the current amount, Below is the formula used to find the future value of an investment based on interest and compounding periods. FV = P (1+) nt %3D
Saving Money: Future value of an investment when we save money in an account, we typically deposit it with some account that will givee Us a percent interest. If we put a dollar into g piggy bank and never touch it again, in a yedr IT will sfill only be one dollar. If we put a dollar into a savings account that is awarding us interest then that dollar could turn into $1.50 in a year, How much we gain is based on the Interest and the compounding period. Compounding period refers to how often the interest IS calculated on the current amount, Below is the formula used to find the future value of an investment based on interest and compounding periods. FV = P (1+) nt %3D
Chapter6: Exponential And Logarithmic Functions
Section: Chapter Questions
Problem 8RE: Suppose an investment account is opened with aninitial deposit of 10,500 earning 6.25...
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Transcribed Image Text:Example 4: A brand new Jeep Wrangler cost $29,000. It is expected to decrease in
126 per year. How much do vou expect it to be worth in 7 years? Part b: Ho w much
did the car lose in value over 7 years?
y=29,001-0.12) = ||51.59229
Saving Money: Future value of an investment
when we save money in an acCount, we typically deposit it with some account that will give
Us a percent interest. If we put a dollar into g piggy bank and never touch it again, in a year
it will still only be one dollar. If we put a dollar into a savings account that is awarding
US inferest then that dollar could turn into $1.50 in a vear, How much we gain is based on fhe
inferest and the compounding period. Compounding period refers to how often the interest
IS calculated on the current amount. Below is the formula used to find the future value of an
investment based on interest and compounding periods.
FV = P (1+)
What do the variables stand for?
FV
What are the different compounding periods?
Semi-annual
Annual
Quarterly
Monthly
Weekly
Daily
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