Find the following values.Compounding/discounting occurs annually.a. An initial $200 compounded for 10 years at 4%b. An initial $200 compounded for 10 years at 8%c. The present value of $200 due in 10 years at 4%d. The present value of $1,870 due in 10 years at 8% and at 4%e. Define present value and illustrate it using a time line with data from part d. How are present values affected by interest rates?

Question

Find the following values.
Compounding/discounting occurs annually.
a. An initial $200 compounded for 10 years at 4%
b. An initial $200 compounded for 10 years at 8%
c. The present value of $200 due in 10 years at 4%
d. The present value of $1,870 due in 10 years at 8% and at 4%
e. Define present value and illustrate it using a time line with data from part d. How are present values affected by interest rates?

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Future value and Present value

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