You just purchased a painting for $1500 as an investment and it is suppose to appreciate in value
at a rate of 3.65% each year. What will it be worth in 25 years?
Why are you switching names?
Surely not to be grazing for answers. I will be happy to check your work.
To calculate the future value of the painting after 25 years, considering an annual appreciation rate of 3.65%, you can use the formula for compound interest:
Future Value = Present Value * (1 + Interest Rate)^Number of Years
In this case, the Present Value (PV) is $1500, the Interest Rate (r) is 3.65% or 0.0365, and the Number of Years (n) is 25.
Substituting these values into the formula, we get:
Future Value = 1500 * (1 + 0.0365)^25
Now let's calculate it step by step:
1. Add 1 to the interest rate: 1 + 0.0365 = 1.0365
2. Raise the result to the power of the number of years: 1.0365^25 ≈ 2.280084091
3. Multiply the result by the present value: 1500 * 2.280084091 ≈ $3,420.13
Therefore, the painting will be worth approximately $3,420.13 in 25 years.