Answered: The amount a person would have to…

The amount a person would have to deposit today (present value) at a 5 percent interest rate to have $1,000 five years from now

Personal Finance

13th Edition

ISBN:9781337669214

Author:GARMAN

Publisher:GARMAN

Chapter1: Understanding Personal Finance

Section1.4: Perform Time Value Of Money Calculations

Problem 3CC

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Concept explainers

Effective Interest Rate

The term interest rate can be defined as the amount that is charged by the lender as a percentage on the principal amount. Interest rate which is charged annually is known as annual percentage rate.

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The amount a person would have to deposit today (present value) at a 5 percent interest rate to have $1,000 five years from now. (Round your PV factor to 3 decimal places and final answer to the nearest whole dollar.)

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