To find the present value of receiving $5000 six years from now at a compounded discount rate of 8%, we can use the present value formula:
Present Value = Future Value / (1 + Discount Rate)^Number of Periods
Plugging in the given values:
Present Value = 5000 / (1 + 0.08)^6
Calculating the discounted present value:
Present Value = 5000 / (1.08)^6
Present Value = 5000 / 1.593848
Present Value ≈ 3134.66
Therefore, the present value of receiving $5000 six years from now at a compounded discount rate of 8% is approximately $3134.66.
A person will receive 5000 six years from now. Present value at a compounded discount rate of 8% is:
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