What is the present value of the following? Use Appendix B as an approximate ans

Question

What is the present value of the following? Use Appendix B as an approximate answer, but calculate your final answer using the formula and financial calculator methods. a. $8,500 in 11 years at 7 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) b. $17,500 in 6 years at 8 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.) c. $27,000 in 17 years at 9 percent? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Explanation / Answer

a. Given the future value= $8,500

Interest rate= 7%

Tenure= 11 years

So present value= $8500/((1+0.07)^11) = $4038.29

b. Given the future value= $17,500

Interest rate= 8%

Tenure= 6 years

So present value= $17500/((1+0.08)^6) = $11027.97

c. Given the future value= $27000

Interest rate= 9%

Tenure= 17 years

So present value= $27000/((1+0.09)^17) = $6238.98

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.