You are going to receive a R100 000 inheritance in ten years.If the prevailing interest rate is 6 percent, the present value of your inheritance is R55 839.48.

Question

Quizplus · Accepted Answer

The present value of a future sum of money can be calculated using the formula PV = FV / (1 + r)^n, where PV is the present value, FV is the future value, r is the interest rate, and n is the number of years. Plugging in the values: PV = 100,000 / (1 + 0.06)^10 = 55,839.48.

You Are Going to Receive a R100 000 Inheritance in Ten