P = Po(1+r)^n
r = (6%/2)/100% = 0.03 = Semi-annual %
rate expressed as a decimal.
n = 2Comp,/yr. * 25yrs. = 50 Compounding periods.
Po(1.03)^50 = $600,000
Po*4.38391 = 600000
Po = $136,864.25 = Present value.
Plug the above values into the given Eq. and get $
find the present value of the following future amount.
600,000 at 6% compunded semiannually for 25 years what is the present value
1 answer
2 answers