Question

Can someone please help with finding the future value of an annuity
a1=$7000 I=0.09 n=10

Answer 1

There's a factor called the F/P factor that gives a future worth given a present sum.

Answer 2

So the future worth is:
\[7000(F/P 9, 10)\]

Answer 3

ok I have tried the calculaters on line for finding the future value and they all keep giving me wrond answers and I do not understan the formula

Answer 4

ok and what does that comeout to in dollars and cents

Answer 5

http://www.me.utexas.edu/~me353/resources/flash/factor_calculator.html

The F/P factor for 9 percent over 10 years is 2.3673

Answer 6

Can I show you the way they are wanting me to do the equation and see if you understand it please

Answer 7

ok so how would I factor that into the 7000

Answer 8

Otherwise, the F/P factor is defined thusly:
\[(1 + \frac{r}{c})^{cn}\]

Answer 9

I have no idea what that means your way above my head

Answer 10

Well in economics/finance classes that's how it's defined. You can lookup the interest factor, though.

In this case it's 2.3673. So look at the equation I wrote a few posts ago. It's simply (7000)(2.3673)

Answer 11

thats an example of what I need with the numbers I have in the question plugged in

Answer 12

so its 7000 times 2.3673?

Answer 13

Oh ok, well they're using the definition of the interest factors. Use those.

Answer 14

Thats the thing I dont get how there doing that last part of the equation

Answer 15

I can plug in the numbers and everyhting its just that last step that has me

Answer 16

Oh you're investing 7000 every year. No, the value will be much higher. It's called the F/A factor. It's definition is that formula. It's literally plug and chug :/