me Value me Taxes Wor 2000 of savings You dont on the inform

me Value me Taxes Wor $2,000 of savings. You don\'t on the information provided in the table, calculate the future value (FV) of $2,000 at the end of years 1 and 5 if it were to be completely invested in each of the different cash n e needing to dip into these funds in the next tive years. Based ees on column relates to question 2 of Scenario1 at e Interest Product Usage No minimum withdrawals Rate ng e No limit on Initial Amount Annual Interest Rate Initial Amount Annual Interest Rate

Solution

Product Annual Interest FV at end of year 1 FV at end of year 5 Checking Account 0.00% Initial Amount $2,000.00 Initial Amount $2,000.00 Rate Of Return 0.00% Rate Of Return 0.00% Number of Years 1 Number of Years 5 Future Value =$2000 x (1+0%)^1 $2,000.00 Future Value =$2000 x (1+0%)^5 $2,000.00 Savings Account 1.50% Initial Amount $2,000.00 Initial Amount $2,000.00 Rate Of Return =1.50%/4 0.38% Rate Of Return =1.50%/4 0.38% Number of Years = 1 x 4 4 Number of Years = 5 x 4 20 Future Value =$2000 x (1+.38%)^4 $2,030.17 Future Value =$2000 x (1+.38%)^20 $2,155.47 Certificate of Deposit 5.00% Initial Amount $2,000.00 Initial Amount $2,000.00 Rate Of Return =5%/4 1.25% Rate Of Return =5%/4 1.25% Number of Years = 1 x 4 4 Number of Years = 5 x 4 20 Future Value =$2000 x (1+.1.25%)^1 $2,101.89 Future Value =$2000 x (1+.1.25%)^20 $2,564.07