Question

Find the future value of the loan. Round your answer to the nearest cent.

P= $700, r = 3%, t= 10 years
The future value of the loan is $

Answer 1

Hello

To solve this question, we have a formula for this

`\begin{gathered} fv=pv(1+r)^n \\ fv=\text{ future value} \\ pv=\text{present value} \\ r=\text{rate} \\ n=\text{times compounded} \end{gathered}`

So we can define our values properly

`\begin{gathered} fv=\text{?} \\ pv=700 \\ r=3\text{ \%}=0.03 \\ n=10 \end{gathered}`

We should input the values into the equation and solve

`\begin{gathered} fv=700(1+0.03)^{^(10)} \\ fv=700(1.03)^(10) \\ fv=700*1.3439 \\ fv=940.74 \end{gathered}`

From the calculation above, the future value of the loan is $940.74