Question

Jose and his wife are purchasing a Condo for $205,000 at 4% for 30 years, find the 'A' the FUTURE VALUE SimpleInterest - amount he would need to repay at the end of the 30 year period.

Answer 1

The formula to be used for the question will be

`F\mathrm{}V=P\mathrm{}V(1+R)^N`

Where,

`\begin{gathered} P\mathrm{}V=\text{PRESENT VALUE = \$205,000} \\ R=\text{rate = 4\%} \\ N=\text{ number of years=30} \end{gathered}`

By substituting the values in the formula above, we will have that

`\begin{gathered} F\mathrm{}V=\text{ \$205,000(1+}\frac{\text{4}}{100})^(30) \\ F\mathrm{}V=205,000(1+0.04)^(30) \\ F\mathrm{}V=205,000(1.04)^(30) \\ F\mathrm{}V=205,000(3.24339751) \\ F\mathrm{}V=\text{ \$664896.4896} \\ The\text{ future value therefore will be} \\ F\mathrm{}V=\text{ \$664,896} \end{gathered}`