Calculate the present value PV of an investment that will be worth $1,000 at the
ID: 3148502 • Letter: C
Question
Calculate the present value PV of an investment that will be worth $1,000 at the stated interest rate after the stated amount of time. HINT [See Example 2.] (Round your answer to the nearest cent.) 7 years, at 5% per year, compounded annually PV =Calculate the present value PV of an investment that will be worth $1,000 at the stated interest rate after the stated amount of time. HINT [See Example 2.] (Round your answer to the nearest cent.) 7 years, at 5% per year, compounded annually PV =
Calculate the present value PV of an investment that will be worth $1,000 at the stated interest rate after the stated amount of time. HINT [See Example 2.] (Round your answer to the nearest cent.) 7 years, at 5% per year, compounded annually PV =
Explanation / Answer
PV = A / (1+i)n
Where
PV = present value.
A is amount = 1000
i = interest rate = 0.05
n = number of years = 7
PV = 1000(1.05)7
PV = $710.68