Question

John is evaluating which investment would be best for his company. He wants to determine the future value of a certain investment that has the following information:
PV = $200
INT = 0.1 or 10%
N = 1 (years)
According to this information, what would be the future value of this investment?
a) $110.67
b) $200.50
c) $220
d) None of the above

Answer 1

Answer: $220

Explanation:

The following information can be derived from the question:

PV = $200

INT = 0.1 or 10%

N = 1 (years)

To calculate the future value of this investment, we will use the formula:

FV = PV( 1 + i)^n

FV = $200(1 + 0.1)

FV = $200(1.1)

FV = $220

The future value of this investment would be $220.