Find the following values for a lump sum assuming annual compounding:
The future value of $500 invested at 8 percent for 1 year.
The future value of $500 invested at 8 percent for 5 years.
The present value of $500 to be received in 1 year when the opportunity cost rate is 8 percent
The present value of $500 to be received in 5 years when the opportunity cost rate is 8 percent.
Discuss present and future values and their implications for the balance sheet and the budget of an organization.