Business Finance
What is the difference between future value and present value

Question Description

What is the difference between the accumulated amount (future value) and the present value of an investment?  Give examples of each.

Final Answer

FV=PV(1+rate/100)^Time

You invest 10 dollars today at 10 percent interest per year.

The present value is 10 dollars.

The future value is: FV=10(1.1)^1= 11 dollars.

Prashant S (1995)
University of Maryland

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