Calculate the present value PV (in dollars) of an investment that will be worth $1,000 at the stated interest rate after the stated amount of time. (Round your answer to the nearest cent.) 5 years, at 3.9% per year, compounded quarterly PV = $

Calculate the present value PV (in dollars) of an investment that will be worth $1,000 at the stated interest rate after the stated amount of time. (Round your answer to the nearest cent.) 5 years, at 3.9% per year, compounded quarterly PV = $

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 11EA: How much would you invest today in order to receive $30,000 in each of the following (for further...

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Concept explainers

Present Value

Present value (PV) is defined as the current or present value of all future sums of cash flow or money at a specified rate of return. This rate of return is known as the discounted rate, which is essentially the interest rate, discounted over some time. The expected cash flows are discounted at a discount rate to compute the present value. The higher the discount rate, the higher the future value (FV), but the lower the present value.

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Calculate the present value PV (in dollars) of an investment that will be worth $1,000 at the
stated interest rate after the stated amount of time. (Round your answer to the nearest
cent.)
5 years, at 3.9% per year, compounded quarterly
PV = $
Find the effective annual interest rater (as a percent) of the given nominal annual interest
rate. Round your answer to the nearest 0.01%.
1% compounded monthly
r%3D
%
(Ctrl)
99+

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