Future Value Calculation

You have the opportunity to invest $1,000 today in an account that pays an annual interest rate of 5%. If you plan to keep your investment in the account for 3 years, what will be the future value of your investment at the end of this period?

The future value can be calculated using the formula:

$FV = PV imes (1 + r)^n$

where:

• $FV$: Future Value
• $PV$: Present Value (initial investment)
• $r$: annual interest rate
• $n$: number of years