What is the present value of a $200 payment made in three years when the discount rate is 8 percent?
A) $150.00
B) $158.77
C) $251.94
D) $515.42

Question

Quizplus · Accepted Answer

The present value (PV) of a future payment can be calculated using the formula PV = FV / (1 + r)^n, where FV is the future value ($200), r is the discount rate (0.08), and n is the number of periods (3 years). Plugging in the values, we get PV = $200 / (1 + 0.08)^3 = $158.77.

What Is the Present Value of a $200 Payment Made