In: Finance
(Future value ) Sales of a new finance book were 12,000 copies this year and were expected to increase by 21 percent per year. What are expected sales during each of the next 3 years?
a. If the 12,000 copies of book sales this year were expected to increase by 21 percent per year, what are the expected sales of the new finance book next year?
Answer: ______copies. (Round to the nearest unit.)
b. If the 12,000 copies of book sales this year were expected to increase by 21 percent per year, what are the expected sales of the new finance book in two years?
Answer: ____copies. (Round to the nearest unit.)
c. If the 12,000 copies of book sales this year were expected to increase by 21 percent per year, what are the expected sales of the new finance book in three years?
Answer: _____copies. (Round to the nearest unit.)
Current sales = 12,000 copies
Rate of increase = 21%
a. The expected sales of the new finance book next year = Current sales * (1 + Rate of increase)^1
The expected sales of the new finance book next year = 12,000 * (1 + 0.21)^1
The expected sales of the new finance book next year = 12,000 * 1.21
The expected sales of the new finance book next year = 14,520 copies
b. The expected sales of the new finance book two years = Current sales * (1 + Rate of increase)^2
The expected sales of the new finance book two years= 12,000 * (1 + 0.21)^2
The expected sales of the new finance book two years = 12,000 * 1.4641
The expected sales of the new finance book two years = 17,569.2
The expected sales of the new finance book two years = 17,569 copies
c. The expected sales of the new finance book three years = Current sales * (1 + Rate of increase)^3
The expected sales of the new finance book three years= 12,000 * (1 + 0.21)^3
The expected sales of the new finance book three years = 12,000 * 1.771561
The expected sales of the new finance book three years = 21,258.732
The expected sales of the new finance book three years = 21,259 copies