What is the present value (PV)of $80,000 received ten years from now,assuming the interest rate is 5% per year?
A)$38,422.76
B)$40,000.00
C)$49,113.06
D)$76,000.00

Question

Quizplus · Accepted Answer

PV = FV/(1+r)^n
PV = 80,000/(1+0.05)^10
PV = $49,113.06

Therefore, the present value of $80,000 received ten years from now, assuming the interest rate is 5% per year is $49,113.06 (Choice C).

What Is the Present Value (PV)of $80,000 Received Ten Years