Chapter5: The Time Value Of Money
Section: Chapter Questions
Problem 7P
Related questions
Question
What is the present value of a $350 payment in one year when the discount rate is 8 percent? (Round your answer to 2 decimal places.)
Expert Solution
Step 1 Analysis
Persent value is currant value of future investment. Persent value is inverse to future value. It can be calculated by using this formula
Persent value = Future Value/(1+r)n
Where Future Value is an amount receive in future
r= Rate of return/ Discounting rate
n= number of years
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