Question
In: Finance
Present Value
If an investment of $50,000 is made today carrying at an interest rate of 5%. What will be its value after 10 years?
Solutions
Expert Solution
Since the lumpsum investment is made at a time. The future value of the investment is to be found.
Present Value = $50,000
Number of years = 10
Rate of interest = 5%
The terms used in formulas are :
PV - Present Value
FV - Future Value
r - Rate of interest
n- number of years
\( \begin{align}FV &= PV(1+r)^n\\ &= \$50,000(1+0.05)^{10}\\ &= \$81,444.73 \end{align} \)
Hence, the value of the investment after 10 years is $81,444.73
The value of the investment after 10 years is $81,444.73
Vinay answered 3 years agoRelated Solutions
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