question archive You have $17,000
You have $17,000
Subject:FinancePrice:2.86 Bought3
You have $17,000. You want to invest them in the stock market. During the first year the investment earned 15% for the year. The second year, you earned only 6% for that year. How much is your original deposit worth at the end of the two years?
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| Calculate amount original deposit is worth at end of two years as shown below: | |||||
| Future value at end of year 1 | 17000*(1.15^1) | ||||
| Future value at end of year 1 | 19550 | ||||
| Future value at end of year 2 | 19550*(1.06^1) | ||||
| Future value at end of year 2 | 20723 | ||||
| Thus, amount of original deposit at end of two years is $20,723 |
