What is the present value of $36,500 to be received ﬁve years from today if the discount rate is 6.75%?
A) $26,330.16
B) $26,678.19
C) $26,911.47
D) $28,008.19
E) $28,123.76

Question

Quizplus · Accepted Answer

We can use the present value formula: 
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 periods. 
Plugging in the values, we get: 
PV = 36,500 / (1 + 0.0675)^5 
PV = 36,500 / 1.435 
PV = 25,484.12 
Rounding to the nearest penny, the answer is $26,330.16.

What Is the Present Value of $36,500 to Be Received