What follows is a fill in the blank question with 2 blanks. An amount of R60000 is invested in a project that predicts the quarterly cash flow return over the next four years, given in the table below. Quarters 1 2 3 7 8 9 10 11 12 13 14 15 16 Rands 1500 2500 3500 5000 6200 7000 7200 7200 6900 6000 6000 8500  x i) If the investment could earn 12,55% p.a as a bank deposit , and the NPV of this cash flow is equal to –R4327,02 , then the value of the payment at T16 , rounded to the nearest cent, is equal to R  Blank 1. Fill in the blank, read surrounding text.

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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.