The future value is the value of money at some future time evaluated at given interest rate. Future value of an investment is the value at the end of the time horizon. FV = PV*(1+i) ^n PV is the...

The future value is the value of money at some future time evaluated at given interest rate. Future value of an investment is the value at the end of the time horizon. FV = PV*(1+i) ^n PV is the current value of future cash flow discounted at appropriate discount rate. Present value of an investment is the value at the beginning of the time period under consideration. PV = FV/ (1+i) ^n X invested $100 at the end of each year for 10 years @10% interest then the future value of this investment is PV = $1000 I = 10% n = 10 year FV = 1000*(1+10%) ^10 = $2593.74 Y put in his account $10,000 to buy a car 10 years from now and gets 5% interest each year. How much he should put in account now? FV = $10,000 I = 5% n = 10 years PV = 10000/ (1+5%) ^10 =$6139.13