To find the present value of $1000 discounted for 20 years at 8%, when using a financial calculator, the correct entry is [blank].
A)N=20, i=.08, PMT=0, FV=1000, solve for PV
B)N=20, i=8, PMT=0, FV=1000, solve for PMT
C)N=20, i=.08, PMT=0, PV=1000, solve for FV
D)N=20, i=8, PMT=0, FV=1000, solve for PV

Question

Quizplus · Accepted Answer

The present value (PV) is what we are solving for, so we need to enter N=20 (number of years), i=8 (interest rate), PMT=0 (no additional payments), FV=1000 (future value), and solve for PV. Therefore, the correct entry is N=20, i=8, PMT=0, FV=1000, solve for PV which is Option D.

To Find the Present Value of $1000 Discounted for 20