Question

Part 5: Relation between Future Value and Number of Periods

In this part, you need to examine the relation between the future value and the number of periods.  

1. For a present value of $5,000, create a table that shows the FV at 0%, 5%, and 10% for 0, 2, 4, 6, 8, and 10 years. (7 Points)

2. In a single graph (scatter plot with straight lines and markers), graph the table above with years on the horizontal axis and FV on the vertical axis for each interest rate and be sure to label the y-axis, x-axis, chart title, and legend. (7 Points)

Part 5:
I)	Interest rate	PV	Year	FV
	Interest rate	PV	Year	FV
	Interest rate	PV	Year	FV
J) Graph

Answer 1

Here Present Value is = $5,000

Future Value (FV) = Present Value (P) * (1+i)ⁿ

                    FV = P * CVF_n,i

CVFn,i = (1+i)^n = Compund Value Factor required for caluclating Future Value

In the table below the Compund Value Factor (CVF) are calculated:

In the table below the Future Values (FV) are calculated:

Scatter Plot for Future Values for Different Years and Interest Rate is given below: