Assuming a one year investment, the formulation for arriving at return is either FV₁ = PV + kPV or FV₁ = PV(1+k).

Question

Quizplus · Accepted Answer

Both formulas are correct for calculating returns on a one year investment, with the first formula being a slightly different way of expressing the second formula. FV represents the future value of the investment after one year, PV represents the initial investment amount, and k represents the rate of return.

Assuming a One Year Investment, the Formulation for Arriving at Return