The present value of $60,000 to be received in one year, at 6% compounded annually, is (rounded to nearest dollar)
A) $56,604
B) $63,396
C) $60,000
D) $3,396

Question

Quizplus · Accepted Answer

We can use the formula for present value of a single amount: PV = FV/(1+i)^n where PV is the present value, FV is the future value, i is the interest rate, and n is the number of periods. Plugging in the given values, we get: PV = 60,000/(1+0.06)^1 = $56,604. Rounded to the nearest dollar, the answer is A: $56,604.

The Present Value of $60,000 to Be Received in One