Your friend is considering investing $10,000 starting at the end of year 1 in aninvestment account and this cash flow will then grow at an annual rate of 4%.She plans on ending her contribution to the investment account at the end ofyear 10. If the annual return on the investment account is expected to be 10%,the future value of this investment at the end of year 10 will be closest to:O $166,667.O $71,550.$185,583.$100,000.

This is problem of future value of growing ANNUITY and can be done using formula. Future value of…

Your friend is considering investing $10,000 starting at the end nvestment account and this cash flow will then grow at an annu She plans on ending her contribution to the investment account year 10. If the annual return on the investment account is expec the future value of this investment at the end of year 10 will be O $166,667. O $71,550.

Your friend is considering investing $10,000 starting at the end nvestment account and this cash flow will then grow at an annu She plans on ending her contribution to the investment account year 10. If the annual return on the investment account is expec the future value of this investment at the end of year 10 will be O $166,667. O $71,550.

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter5: The Time Value Of Money

Section: Chapter Questions

Problem 27P

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