Present Value of 1 Future Value of 1 Present Value of an Annuity of 1 Future Value of an Annuity of 1 The future value of $100 compounded semiannually for 3 years at 12% equals $140.49.
Future Value = Present Value * Interest Factor
FV of 1 factor for n = 6 and i = 6% = 1.4185
Future Value = $100 * 1.4185 = $141.85

Question

Present Value of 1  Future Value of 1  Present Value of an Annuity of 1  Future Value of an Annuity of 1  The future value of $100 compounded semiannually for 3 years at 12% equals $140.49.
Future Value = Present Value * Interest Factor
FV of 1 factor for n = 6 and i = 6% = 1.4185
Future Value = $100 * 1.4185 = $141.85

Quizplus · Accepted Answer

The question provides an interest rate of 12%, but the calculation uses an interest factor for 6% (n=6 is correct for semiannual compounding, but the interest rate should be 6% semiannually, not an annual rate of 12%). Therefore, the calculated future value is incorrect and the answer is false.