The present value of $2,000 one year in the future at a 6.5 percent interest rate is approximately

Name: The present value of $2,000 one year in the future at a 6.5 percent interest rate is approximately
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Quizplus · Accepted Answer

The present value (PV) is calculated using the formula PV = FV / (1 + r)^n, where FV is the future value, r is the interest rate, and n is the number of periods. Here, FV = $2,000, r = 6.5% or 0.065, and n = 1. So, PV = $2,000 / (1 + 0.065)^1 = $2,000 / 1.065 ≈ $1,878.

The Present Value of $2,000 One Year in the Future