There is a Financial Formula available that on the surface seems to do what you want:

ACCRINTM(I, S, R, P [, B])
Description
This function returns the accrued interest for a security that pays interest at maturity.

Parameters
I The issue date, a date/time value.
S The settlement date, a date/time value.
R The annual coupon rate.
P The par value of the security.
B (Optional) the day count basis to be used:
0 or omitted 30/360
1 Actual/actual
2 Actual/360
3 Actual/365

However if you must use:

VALUE = $8566 x(1+i)^8.5 where the ^ sign means "to the power of".

then substituting "**" for "^" will should work.

VALUE = $8566 * ((1+i)**8.5)

Example:
In any cell type

=8566*((1.059497651)**8.5)

and you will get

14000.000609278

So in a nutshell "Use ** when you wish to raise a value to a power"