Question 1142181
the formula to use is f = p * (1 + r) ^ n


f is the future value
p is the present value
r is the interest rate per time period
n is the number of time periods


in your problem, you get:


p = 20,000
r = minus .07 per year
n = 6 years


formula becomes f = 20,000 * (1 - .07) ^ 6.


solve for f to get f = 12939.80367


round to the nearest cent to get 12939.80.


note that if you gain 7% per year, then the interest rate is positive and when you lost 7%, the interest rate is negative.


you can graph this formula as shown below.


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