Question on calculation of FV - The Punters Lounge

O1F · 28-04-2008, 04:46

Hopefully this is posted in the right section.

With a start bank of $1000, how much would it grow to in 365 days if 1% is compounded daily?

Thanks for any replies

muppet77 · 28-04-2008, 04:53

37,409.34

O1F · 28-04-2008, 05:16

Thanks muppet77!

koochak · 28-04-2008, 17:13

Muppet gave the wrong answer. The correct answer is $37,783.43

kef4o · 28-04-2008, 19:27

koochak is right. Your question is quite simple really: a daily increase by 1% means that you should just put the number 1.01 to the power of 365.

Grex · 28-04-2008, 21:22

I hate to be an "anorak"

.... but you could both be right... it depends how you interpret the first 2 days. If you start with a bank of $1,000 on Day 1, and don´t apply the 1% interest until Day 2, then the equation would be 1000*(1.01^364) = 37,409.34.... however, if you assume you earn the 1% interest on Day 1, then it would be 1000*(1.01^365) = 37,783.43.

Anyway, what´s $374.09 between friends!

28-04-2008, 04:46	#1 (permalink)
O1F Junior Punter Join Date: 08 Mar 2006 Location: Moneyland Age: 30 Posts: 89	Question on calculation of FV Hopefully this is posted in the right section. With a start bank of $1000, how much would it grow to in 365 days if 1% is compounded daily? Thanks for any replies __________________ Route to Moneyland starts here...

28-04-2008, 04:53	#2 (permalink)
muppet77 Muppet Punter Join Date: 26 Oct 2004 Posts: 1,876	Re: Question on calculation of FV 37,409.34

28-04-2008, 05:16	#3 (permalink)
O1F Junior Punter Join Date: 08 Mar 2006 Location: Moneyland Age: 30 Posts: 89	Re: Question on calculation of FV Thanks muppet77! __________________ Route to Moneyland starts here...

28-04-2008, 17:13	#4 (permalink)
koochak Alien Punter Join Date: 15 Apr 2008 Location: Space Station 1X2 Posts: 16	Re: Question on calculation of FV Muppet gave the wrong answer. The correct answer is $37,783.43

28-04-2008, 19:27	#5 (permalink)
kef4o Senior Punter Join Date: 02 Mar 2007 Posts: 108	Re: Question on calculation of FV koochak is right. Your question is quite simple really: a daily increase by 1% means that you should just put the number 1.01 to the power of 365.

28-04-2008, 21:22	#6 (permalink)
Grex Mouldy Oldie Join Date: 15 Jun 2007 Location: Montenegro Posts: 263	Re: Question on calculation of FV I hate to be an "anorak" .... but you could both be right... it depends how you interpret the first 2 days. If you start with a bank of $1,000 on Day 1, and don´t apply the 1% interest until Day 2, then the equation would be 1000(1.01^364) = 37,409.34.... however, if you assume you earn the 1% interest on Day 1, then it would be 1000(1.01^365) = 37,783.43. Anyway, what´s $374.09 between friends! __________________ Three rotating balls..... and counting Last edited by Grex; 28-04-2008 at 21:24.

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