$100 is received at the beginning of year 1,$200 is received at the beginning of year 3.If these cash flows are deposited at 12 percent,their combined future value at the end of year three is: (Round to the nearest whole dollar)
A) $672
B) $536
C) $427
D) $364
E) $489

Question

Quizplus · Accepted Answer

Step 1 - Find the future value of each cash flow.
FV = PV × 11ea7fdb_fc1e_9796_a768_9b9362557619_TB2902_11 FV = 100 × (1.12 11ea7fdb_fc1e_9797_a768_e1f283026d77_TB2902_11 = $140.49
FV = 200 × (1.12 11ea7fdb_fc1e_9798_a768_21fca6c7cfa7_TB2902_11 = $224
Step 2 - Add the two future values together to get the total.
140.49 + 224 = $364.49

$100 Is Received at the Beginning of Year 1,$200 Is