Question

The value V, of a 300000 investment that earns 2% annual interest is given by V=f(t) where t is in years

How much is the investment worth in 3 years

Answer 1

$318,362.40

Explanation:

The equation that describes the future value of investments with interests compounded annually is:

`V = P*(1+r)^t`

Where P is the initial investment (300,000), r is the interest rate (2%) and t is the time of investment, in years (3):

`V = 300,000*(1+0.02)^3\\V=\$318,362.40`

The investment is worth $318,362.40 in 3 years.