Making an investment (FV Function): lump sum deposit
Your cousin Jane is surprised to see that you have an investment plan while you are still in Business school. She already started to work two years ago and she usually spends all her money without saving.
She plans to have a vacation this summer, thus has managed to save $2,000. But due to the current virus situation, she decides not to go anywhere, and put the money in a certified saving account (a fixed two-year plan). Jane asks you to do the calculation for her. The annual interest/return rate for her saving is 2.75%.
Use the FV function to calculate the future value of the investment (how much money that she will have at the end of two years).
You need to figure out how to set up and enter data into your worksheet, and then calculate.
Your worksheet should be set up in such a way that parameters of the FV function is clearly labeled (e.g., Rate, Nper), and value for these parameters are entered in cells; the two solution cells should be properly labeled as well. You must use cell reference in your FV function.
For example, you cannot use the annual interest rate 3.5% directly in the FV function, you must enter it in a cell, and reference that cell inside the FV function. In sum, you Excel set up should be easy to understand and use.
After you enter everything, you will get a number! but it is a negative number. FV is to calculate the future debt! If you use it to calculate the saving, or investment, you will need to add a negative sign before Pmt.
All your worksheets should be properly formatted, for example, number for money with “$” sign, thousand separators. The dollar amount should have two decimal places. Get Finance homework help today