The rate of interest is, r = 5% =0.05.Substitute all these values in the the present value formula:PV = FV / (1 + r / n)ntPV = 4500 / (1 + 0.05/1)1(4) = 4500 / (1.05)4 = 3,800 (The answer is rounded to the nearest thousands)....
This is what is known as the present value of $1,000 USD at a discount rate of five percent. The formula used to calculate for present value is PV = P/〖(1+i)〗^n. P stands for the principal, or cash; i equals the discount rate; and n represents the number of periods. ...
Answer to: What is the present value of a 4-year ordinary annuity of $2,250 per year plus an additional $3,000 at the end of year 4 if the interest...
Answer to: What is the present value of a seven-year $1000 annuity if the first $1000 payment is made four years from today and the discount rate...
What is the present value of all future retirement payments attributed by the pension benefit formula to employee services rendered prior to that date only? A. Service cost. B. Accumulated benefit obligation. C. Interest cost. D. Projected benefit obligation. 相关知识点: 试题来源: 解析 B 略...
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Using thepresent value formulaabove, we can see that the annuity payments are worth about $400,000 today, assuming an average interest rate of 6 percent. Thus, Mr. Johnson is better off taking the lump sum amount today and investing in himself. ...
What is the market value of each loan note?A.$109·34 B.$112·01 C.$116·57 D.$118·68 The finance director of Ring Co has been advised to calculate the net asset value (NAV) of the company. Which of the following formulae calculates correctly the NAV of Ring Co? A.Total assets...
In this case, $2,200 is the future value (FV), so the formula for present value (PV) would be $2,200 ÷ (1 + 0. 03)1. The result is $2,135.92. So if you were to be paid now you'd need to receive at least $2,135.92 (not just $2,000) to come out even. Calculating ...
The discount rate is the sum of the time value and a relevant interest rate that mathematically increases future value in nominal or absolute terms. Conversely, the discount rate is used to work out future value in terms of present value, allowing a lender to settle on the fair amount of a...