If the interest rate is 6%,the present value of receiving $300 next year is approximately:

Name: If the interest rate is 6%,the present value of receiving $300 next year is approximately:
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Question

Quizplus · Accepted Answer

The formula to calculate the present value of a future payment is:

Present Value = Future Value / (1 + interest rate)^n

where n is the number of years in the future.

In this case, we have:

Present Value = $300 / (1 + 0.06)^1 = $283.02

Rounding to the nearest dollar gives us Choice C as the best answer.

If the Interest Rate Is 6%,the Present Value of Receiving