Question

Using excel what is the future vale of $1,000 invested at 7% per year for 15 years. Assume that interest is compounded annually. Show work and explain in words how you got the answer

Answer 1

	Amount investment = $ 1000
	Interest rate per year = 7% per annum
	Period = 15 Years
	Years	Investment	Interest @ 7% Per Year	Running Bal
	1	$1,000.00	$70.00	$1,070.00
	2		$74.90	$1,144.90
	3		$80.14	$1,225.04
	4		$85.75	$1,310.80
	5		$91.76	$1,402.55
	6		$98.18	$1,500.73
	7		$105.05	$1,605.78
	8		$112.40	$1,718.19
	9		$120.27	$1,838.46
	10		$128.69	$1,967.15
	11		$137.70	$2,104.85
	12		$147.34	$2,252.19
	13		$157.65	$2,409.85
	14		$168.69	$2,578.53
	15		$180.50	$2,759.03
	Answer = Total compounding value = $ 2759.03
	Desscription:
	Amounte invested is $ 1000 and we are earning the interest @ 7% on this investment
	so in the first year we are earn $ 70 and total will become $ 1070. In nest year we can
	earn interest on cumulative balance of $ 1070. This will be continioulsy done till 15 years
	Means in every year we can earn 7% on our cumulative balance.