Excel Magic Trick 1138: Basic Future Value Calculation: FV Function or Math Formula

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See how to calculate Future Value on an investment with a constant interest rate, defined number of periods and a lump sum deposit using:
1) FV Function
2) Math Formula
  1. excelisfun
  2. Excel 2013
  3. Excel 2003
  4. Excel 2007
  5. Excel 2010
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Excel Magic Trick 1138: Basic Future Value Calculation: FV Function or Math Formula 

excelisfun
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So happy to see you back on the air.  Missed your videos. Be

robertlohman
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Thanks Mike.  Wow, 12%, wouldn't that be nice.  

krn
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Thanks for the video Mike. Because I know you're a math genius, I always wonder why you divide the % per year by 12

Is your basic assumption the simple interest instead of the compound interest?

Because in case of compound interest the correct formula should be  =(1+0, 03)^(1/12)-1

The outcome is less than 0, 25% (0, 246...%

(The 0, 03 should be a cell reference in the real world ofcourse)

When you use the outcome with the following formula, it returns 3%

=((1+0, 00246627)^12)-1

ExcelxlNl