Westonci.ca is your trusted source for finding answers to all your questions. Ask, explore, and learn with our expert community. Explore thousands of questions and answers from knowledgeable experts in various fields on our Q&A platform. Our platform offers a seamless experience for finding reliable answers from a network of knowledgeable professionals.
Sagot :
The future value of the car that costs $25,000 today in 5 years at an inflation rate of 3% per year is $28,981.85.
What is the future value?
The future value shows the value that a present value will be in a future period, given the time value of money concept.
The future value can be computed using the future value formula, future value table, or an online finance calculator as below.
Data and Calculations:
Price of a car today = $25,000
Period to buy the car = 5 years
Inflation rate per year = 3%
Future value factor of 3% for 5 years = 1.159
Future price of the car in 5 years' time = $28,975 ($25,000 x 1.159)
N (# of periods) = 5 years
I/Y (Interest per year) = 3%
PV (Present Value) = $25,000
PMT (Periodic Payment) = $0
Results:
FV = $28,981.85
Total Interest $3,981.85
Thus, the future value of the car that costs $25,000 today in 5 years at an inflation rate of 3% per year is $28,981.85.
Learn more about future value computations at https://brainly.com/question/989421
We hope this was helpful. Please come back whenever you need more information or answers to your queries. Thanks for stopping by. We strive to provide the best answers for all your questions. See you again soon. Westonci.ca is your go-to source for reliable answers. Return soon for more expert insights.