Task: (Present and future values) Assume that you are starting with an investment of $10,000.
Question 1: What is the future value of the investment after one year if it earns 10% per year? What is the present value of this future value discounted at 10%?
Question 2: What is the future value of the investment after one year if it earns 20% per year? What is the present value of this future value discounted at 10%?
Question 3: What is the future value of the investment after one year if it earns 10% per year? What is the present value of this future value discounted at 20%?