You are investing $10,000 in a project and expecting a 5% return on this investment each year for 10 years. Assuming annual coumpound interest [or rate of return) what is the future value of your investment.
The question is referring to “return on investment” which is a financial management technique under the “Project Cost Management” area (chapter 7 in PMBOK 5th edition). The formula is:
fv=pv*(1+r)^n or future value=present value*(1+rate)^number of years
number of years=10
So I get “c” as the answer. This tells you what the value of your investment will be in 10 years at this rate.
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This interview with Simona Fallavollita (LinkedIn Profile) was recorded at the magnificient Project Management Institute (PMI)® Global Conference 2017 in Chicago, Illinois. We discuss the how, what, why and when of the changes that are coming to the PMP exam.