The price of the latest incredible iThing from Apple starts at $200 when it is first released. Every year it gets better but the price goes up 8%. What is the price after 20 years? [You can see problems just like this one in the Gateway Exams section of our website. The screencast shows how to solve this among others].
You can use a formula like this to solve that:
FV = PV x [1 + R]^N, where FV=Future value, PV=Present value, R=Rate(of interest), N= Number of periods.
FV = 200 x [1 + 0.08]^20
FV = 200 x[1.08]^20
FV = 200 x 4.6609571........
FV = $932.19 - The price of Apple's iThing after 20 years.
You can use a formula like this to solve that:
FV = PV x [1 + R]^N, where FV=Future value, PV=Present value, R=Rate(of interest), N= Number of periods.
FV = 200 x [1 + 0.08]^20
FV = 200 x[1.08]^20
FV = 200 x 4.6609571........
FV = $932.19 - The price of Apple's iThing after 20 years.
