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Chapter 4: Question (page 281)

You invest $3,000 for three years at 12 percent.

a. What is the value of your investment after one year?

Short Answer

Expert verified

Answer

The value of investment after one year is $3,360.

Step by step solution

01

Identification of the required information

Present value (PV) = $3,000

Interest Rate (i) = 12%

Period (n) = 1 year

02

Value of investment after one year (FV)


FV=PV脳(1+i)n=$3,000脳(1+12%)1=$3,360

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