Using the following partial table of present value of $1 at compound interest, compute the present value of $20,000 (rounded to nearest dollar) to be received one year from today, assuming an earnings rate of 15%. ? $$\begin{array} { c c c c }
\text { Year } & 10 \% & 15 \% & 20 \% \
\hline 1 & 0.909 & 0.870 & 0.833 \
2 & 0.826 & 0.756 & 0.694 \
3 & 0.751 & 0.658 & 0.579 \
4 & 0.683 & 0.572 & 0.482 \
5 & 0.621 & 0.497 & 0.402 \
6 & 0.564 & 0.432 & 0.335 \
7 & 0.513 & 0.376 & 0.279 \
\hline
\end{array}$$

Question

Using the following partial table of present value of $1 at compound interest, compute the present value of $20,000 (rounded to nearest dollar) to be received one year from today, assuming an earnings rate of 15%. ? $$\begin{array} { c c c c } 
\text { Year } & 10 \% & 15 \% & 20 \% \
\hline 1 & 0.909 & 0.870 & 0.833 \
2 & 0.826 & 0.756 & 0.694 \
3 & 0.751 & 0.658 & 0.579 \
4 & 0.683 & 0.572 & 0.482 \
5 & 0.621 & 0.497 & 0.402 \
6 & 0.564 & 0.432 & 0.335 \
7 & 0.513 & 0.376 & 0.279 \
\hline
\end{array}$$

Quizplus · Accepted Answer

The present value of $1 to be received one year from today at 15% is 0.870. Therefore, the present value of $20,000 to be received one year from today at 15% is $20,000 x 0.870 = $17,400.

Using the Following Partial Table of Present Value of $1