If the single amount of $3000 is to be received in 3 years and discounted at 6% its present value is
A) $2519.
B) $2830.
C) $2600.
D) $2820.

Question

Quizplus · Accepted Answer

We can use the formula for present value of a single amount:

PV = FV / (1 + r)^n

Where PV is the present value, FV is the future value, r is the discount rate, and n is the number of years.

In this case, FV = $3000, r = 6%, and n = 3. Plugging these values into the formula, we get:

PV = 3000 / (1 + 0.06)^3
PV = 3000 / 1.191016
PV = $2519.17 (rounded to the nearest cent)

Therefore, the best choice is A, with a present value of $2519.

If the Single Amount of $3000 Is to Be Received