Answer:
The investment will have a value of $2875.60 after 6 years.
Explanation:
The formula to determine the final value of this investment at the end of this period is:
Future Value= Present Value*(1+r)^n
Where:
Present Value= Current value is capital today. In this case $1,820
Future Value= It is the value that is generated as a result of a compound nominal rate applied to a certain number of periods in which said rate is applied plus the present value.
r= The interest rate at which the debt is generated is determined in percentage and its duration is annual. In this case 8%
n=The periods that the investment or debt will last. In this case there are 6 periods because the investment is annual.
FV= 1820 *(1+0.08)^6
FV=1820*1.58
FV= 2875.60
