Derek received R 1 200 at the beginning of year1, R 2 200 at the beginning of year 2 and R 3 300 at the beginning of year 3. If he deposited these cash flows at a 12% annual rate, he's combined future value at the end of year 3 would be?
The total FV of the three payments will be:
R 8,141.59.
You can find their FV by evaluating them individually, which is the easiest way, then add them all up . This is the formula you would use to do that: Remember, the deposits are made at the BEGINNING of the year, which is important.
FV=PV[1 + R]^N, where FV=Future Value, PV=Present value, R=Interest rate per period, N=Number of periods.
