Question

Find the following values:a. An initial $500 compounded for 1 year at 4%b. An initial $500 compounded for 2 years at 4%c. The present value of $500 due in 1 year at a 4% discount rated. The present value of $500 due in 2 years at a 4% discount rate

Answer 1

Step-by-step explanation:

a) A = 500 (1 + .04)^1 = 520

b) A = 500 (1 + .04)^2 = 540.8

c) A = 500 (1 - .04)^1 = 480

d) A = 500 (1 - .04)^2 = 460.8