Consider the following timeline:
If the current market rate of interest is 7%,then the future value of this timeline as of year 3 is closest to:
A) $1720
B) $1500
C) $1404
D) $1717

Name: Consider the following timeline: If the current market rate of interest is 7%,then the future value of this timeline as of year 3 is closest to: A) $1720 B) $1500 C) $1404 D) $1717
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Question

Consider the following timeline: 
If the current market rate of interest is 7%,then the future value of this timeline as of year 3 is closest to:
A) $1720 
B) $1500 
C) $1404 
D) $1717

Quizplus · Accepted Answer

A) FV = PV(1 + r)ⁿ FV = 500(1.07)³ + 500(1.07)² + 500(1.07)¹ = $1719.97 or approximately $1720

Consider the Following Timeline