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Glossary
Predicting the Future (Future Value, That Is)

Knowledge Check

We've talked a lot about future value and seen many examples of it put to use. Now that you understand it, you should be able to define it. Which of the following is a definition of future value?

Which of the following is the future value equation?

Consider the following scenario. You have $100. Your brother would like to borrow $100 from you for two years and pay you back at 5% interest. If you were inserting values into the future value equation, what would you put in place of "PV"?

Consider the following scenario. You have $250. You are saving for a new car stereo. You put your money in the bank for three years, earning 2% interest. If you were inserting values into the future value equation, what would you put in place of "i"?

Consider the following scenario. You have $250. Your little sister wants to borrow $200. She'll pay you back $200 in one year, plus 10% interest. If you were inserting values into the future value equation, what would you put in place of "PV"?