Future Value and example

Future Value is the amount at some future time of a present amount of money, or a series of payment, evaluated at a given interest rate. another term for future value is a money equivalent in value to s specific sum of money today.

Calculation of Components:

PV = how much money a person has today
FV = how much money a person expect to in the future
 I    = the percentage rate on money invested
T    = Means Time, length tme of investment

Formula:  FV = PV ( 1+i )n

Example: How much money will you have in 5 years if  you invest 100 pesos today at 10% rate of return?

Solution:  FV = PV ( 1+i )n
Subtitute: FV = 100 ( 1+ 0.05 )5
                     = 100 (1.1) (1.1) (1.1) (1.1) (1.1)
                     = 161.051 -answer


We, elaborate the  exponential  or  time to a  manual procedure  for make it easy. specially for non scientific calculator user.