Question

What 3 things (and only 3 things) are needed to make a lump sum projection?

Answer 1

To make a lump sum projection, you need three key pieces of information: the initial investment, the interest rate, and the time period.

Step-by-step explanation:

To make a lump sum projection, you need three key pieces of information:

1. The Initial Investment: This is the amount of money you are starting with.
2. The Interest Rate: This is the rate at which the money will grow over time.
3. The Time Period: This is the length of time for which you want to project the growth of the investment.

For example, let's say you have an initial investment of $10,000, an interest rate of 5% per year, and a time period of 10 years. Using these three pieces of information, you can calculate the future value of the investment using the formula:

Future Value = Initial Investment * (1 + Interest Rate/100)^Time Period

In this case, the future value would be $16,288.95.