future value

You just received a bonus of 1,000.

a. Calculate the future value of 1,000, given that it will be held in the bank for 9 years and earn an annual interest rate of 8 percent.

b. Recalculate part (a) using a compounding period that is ;(1) semiannual and ;(2) bimonthly.

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c. Recalculate parts (a) and (b) using an annual interest rate of 116 percent.

d. Recalculate part (a) using a time horizon of 18 years at an annual interest rate of 8 percent.

e. What conclusions can you draw when you compare the answers in parts (c) and (d) with the answers in parts (a) and (b)?

a. What is the future value of $1,000 in a bank account for 9 years at an annual interest rate of 8 percent?

$___(Round to the nearest ;cent.)