Find the present value of an investment at 7% annual simple interest which is worth $30,000 after 30 months. Round your answer to the nearest cent.
A) $P V = \$ 25,531.41$
B) $P V = \$ 25,521.91$
C) $P V = \$ 25,531.91$
D) $P V = \$ 25,537.01$
E) $P V = \$ 25,530.91$

Question

Find the present value of an investment at 7% annual simple interest which is worth $30,000 after 30 months. Round your answer to the nearest cent.   
A) $P V = \$ 25,531.41$
B)   $P V = \$ 25,521.91$
C)   $P V = \$ 25,531.91$
D)   $P V = \$ 25,537.01$
E)   $P V = \$ 25,530.91$

Quizplus · Accepted Answer

To find the present value (PV) of an investment using simple interest, the formula is $PV = \frac{A}{1 + rt}$, where $A$ is the future value, $r$ is the annual interest rate, and $t$ is the time in years. Given $A = \$30,000$, $r = 0.07$ (7% annual interest), and $t = \frac{30}{12}$ years (since 30 months is 2.5 years), we calculate $PV = \frac{\$30,000}{1 + 0.07 \times 2.5} = \$25,531.91$.

Find the Present Value of an Investment at 7% Annual PV=$25,531.41P V = \$ 25,531.41PV=$25,531.41

Find the Present Value of an Investment at 7% Annual $P V = \$ 25,531.41$