Which of the following equations is used to calculate the present value of a sum to be received in future? A) PV = FV_n ÷ (1 + i)ⁿ B) PV = FV_n × (1 + i)ⁿ C) PV = (1 + i)ⁿ + FV_n D) PV = (1 + i)ⁿ ÷ FV_n

Question

Quizplus · Accepted Answer

The correct formula for calculating the present value (PV) of a future sum involves dividing the future value (FV) by the factor (1 + i)^n, where i is the interest rate and n is the number of periods. This is represented in choice A, albeit in a complex notation.

Which of the Following Equations Is Used to Calculate the Present