Suppose you have $10,000 to invest in a large-company stock for 10 years. The average annual rate of return is 8%. What is the real future value of your investment after 10 years?

Question

Quizplus · Accepted Answer

The formula for future value with compounding interest is:
FV = PV x (1 + r)^n
Where FV is the future value, PV is the present value, r is the rate of return, and n is the number of years.
Using this formula, we can calculate the future value of the investment:
FV = 10,000 x (1 + 0.08)^10 = $21,589.

Suppose You Have $10,000 to Invest in a Large-Company Stock