The present value of $5,000 to be received in 4 years at a market rate of interest of 6% compounded annually is $3,636.30.

Name: The present value of $5,000 to be received in 4 years at a market rate of interest of 6% compounded annually is $3,636.30.
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Question

Quizplus · Accepted Answer

The present value should be higher than the future value, since the market interest rate is positive. The correct present value of $5,000 to be received in 4 years at a market rate of interest of 6% compounded annually is $4,105.92, not $3,636.30.

The Present Value of $5,000 to Be Received in 4