Items 48 through 51 apply to the appropriate use of interest tables. Given below are the future value factors for 1 at 8% for one to five periods. Each of the items 48 to 51 is based on 8% interest compounded annually.

-What amount should be deposited in a bank account today to grow to $10,000 three years from today?
A) $10,000 × 1.260
B) $10,000 × 1.260 × 3
C) $10,000 ÷ 1.260
D) $10,000 ÷ 1.080 × 3

Question

Items 48 through 51 apply to the appropriate use of interest tables. Given below are the future value factors for 1 at 8% for one to five periods. Each of the items 48 to 51 is based on 8% interest compounded annually.
 
-What amount should be deposited in a bank account today to grow to $10,000 three years from today?
A) $10,000 × 1.260 
B) $10,000 × 1.260 × 3 
C) $10,000 ÷ 1.260 
D) $10,000 ÷ 1.080 × 3

Quizplus · Accepted Answer

1.260 × PV = $10,000; PV = $10,000 ÷ 1.260

Items 48 Through 51 Apply to the Appropriate Use of Interest