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Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383

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BuyFindarrow_forward

Economics (MindTap Course List)

13th Edition
Roger A. Arnold
ISBN: 9781337617383
Textbook Problem

What is the present value of $1,000 two years from today if the interest rate is 5 percent?

To determine

The present value.

Explanation

The present value (PV) can be calculated using the formula given below:

PV=An(1+i)n

Here

An is the actual amount of income.

 i is the interest rate.

n is the number of years in the future

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