What is the present value of $1,000 to be received 10 years from today? - 4551

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What is the present value of $1,000 to be received 10 years from today? Assume that the investment pays 8.5% and it is compounded monthly (round to the nearest $1).

a.$893

b.$3,106

c.$429

d.$833

The formula for determining present value, with compounding is PV = FV/ (1+(r/t)) NT. N= the number of years, T= the number of compounding periods = 12, and r = 8.5%

Solution Description

What is the present value of $1,000 to be received 10 years from today? Assume that the investment pays 8.5% and it is compounded monthly (round to the nearest $