Answer:
We can use the formula for compound interest to solve this problem:
A = P(1 + r/n)^(nt)
where A is the future value, P is the present value, r is the interest rate, n is the number of times the interest is compounded per year, and t is the time period in years.
(a) To find the present value of the money, we need to solve for P in the formula above. We are given that A = $3000 and t = 18/12 = 1.5 years. The interest rate is 6% per year, compounded monthly, which means n = 12. Substituting these values into the formula, we get:
3000 = P(1 + 0.06/12)^(12*1.5)
Simplifying and solving for P, we get:
P = 3000 / (1 + 0.06/12)^(12*1.5)
P = $2,572.39
Therefore, the equivalent value of the money now is $2,572.39.
(b) To find the equivalent value of the money one year from now, we need to calculate the future value of $1 after one year, and then multiply it by the present value we found in part (a). The future value of $1 after one year, at 6% per year, compounded monthly, is:
FV = 1*(1 + 0.06/12)^(12*1)
FV = $1.06168
Multiplying this by the present value we found in part (a), we get:
$2,572.39 * $1.06168 = $2,735.92
Therefore, the equivalent value of the money one year from now is $2,735.92.
(c) To find the equivalent value of the money three years from now, we need to calculate the future value of $1 after three years, and then multiply it by the present value we found in part (a). The future value of $1 after three years, at 6% per year, compounded monthly, is:
FV = 1*(1 + 0.06/12)^(12*3)
FV = $1.19102
Multiplying this by the present value we found in part (a), we get:
$2,572.39 * $1.19102 = $3,066.63
Therefore, the equivalent value of the money three years from now is $3,066.63.