Question

Suppose your parents decide to invest $5000 go the financial adviser anticipate that the value go with increased 17% every year for the next 15 years how much would the investment be worth after

Answer 1

The final value would be 52,693.61 dollars.

Explanation:

The money increased 17% every year for the next 15 years. It means the money was invested at compound interest and we can use Future Value formula given as follows:-

FV = P*(1 + r)ⁿ

where FV = Future value of money, P = Principal amount invested

r = rate of interest (in decimals), n = time period (in years).

Given information is P = $5,000, r = 17% = 0.17, n = 15 years.

Using the information in the formula, FV = 5000 * (1 + 0.17)¹⁵

FV = 5000 * (1.17)¹⁵

FV = 5000 * 10.53872146

FV = 52,693.6073

FV ≈ 52,693.61 dollars.

Hence, the final value would be 52,693.61 dollars.