A single amount of $4,700 is to be received in 3 years. If the single amount is discounted at 6% for 3 periods, the present value is
A) $12,563
B) $4,700
C) $3,948
D) $4,418

Question

Quizplus · Accepted Answer

The present value (PV) can be calculated using the formula PV = FV / (1+r)^n, where FV is the future value, r is the discount rate, and n is the number of periods.

In this case, FV = $4,700, r = 6%, and n = 3. So, PV = $4,700 / (1+0.06)^3 = $3,948.

Therefore, the correct answer is choice C.

A Single Amount of $4,700 Is to Be Received in 3