Find the present value. Round to the nearest cent.
-
A)$4,548.91
B)$7,751.09
C)$19,518.55
D)$8,371.17

Question

Find the present value. Round to the nearest cent. 
- 
A)$4,548.91 
B)$7,751.09 
C)$19,518.55 
D)$8,371.17

Quizplus · Accepted Answer

Both present values have the same future value of $10,000, but they have different interest rates and time periods. The first present value is calculated with an interest rate of 5% for 10 years, while the second present value is calculated with an interest rate of 3.5% for 20 years. Using a present value calculator, we get:

- For the first present value: PV = $5,675.31
- For the second present value: PV = $3,257.98

Therefore, the best choice is B, which matches the second present value calculated.

Find the Present Value