Future Value

The value of an investment at some point in the future given some assumptions about its returns. For simple interest it is given by the equation:

 

where:

PV = Present value of the investment

r = the interest rate

t = time

 

 

Future Value can also be given by a slightly more complex formula when we need to account for compounding growth or interest:

where:

C0 = Cost, or Present Value

r = return, or interest rate

n = number of periods compounding

 

 

 

 

 

 

 

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