The future-value-of-money formula relates how much a current investment will be

Question

The future-value-of-money formula relates how much a current investment will be worth in the future, assuming a constant interest rate. FV = PV X (1 + I)n where FV is the future value PV is the present value or investment I is the interest rate expressed as a fractional amount per compounding period-i.e., 5% is expressed as .05 n is the number of compounding periods. Create a MATLAB function called future _ value with three inputs: the investment (present value), the interest rate expressed as a fraction, and the number of compounding periods. Use your function to determine the value of a $1000 investment in 10 years, assuming the interest rate is 0.5% per month, and the interest is compounded monthly.

Explanation / Answer

>> function [FV] = future_value (PV, I, N) >> FV = PV*(1+I)^N; >> future_value(1000, 0.5, 10*12) >>ans. 1.35E24

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.