The solution to this problem requires time value of money calculations. Reference to Tables 9-1 through 9-4 in the text is necessary to complete the calculations. The future value of $6,000 at 12% compounded quarterly for 5 years is
A) $ 9,600
B) $ 6,954
C) $10,572
D) $10,836

Question

Quizplus · Accepted Answer

The future value of $6,000 at 12% compounded quarterly for 5 years is $10,836. This can be calculated using the formula FV = PV * (1 + r/n)^(n*t), where PV is the present value, r is the annual interest rate, n is the number of times per year that the interest is compounded, and t is the number of years. In this case, PV = $6,000, r = 12%, n = 4 (since the interest is compounded quarterly), and t = 5. Plugging these values into the formula, we get FV = $6,000 * (1 + 0.12/4)^(4*5) = $10,836.

The Solution to This Problem Requires Time Value of Money