The present value of $300 received 5 years in the future would be calculated as which of the following when the interest rate is 5%?

Question

Quizplus · Accepted Answer

The present value of $300 received 5 years in the future 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 periods. Plugging in the given values, we get PV = 300 / (1 + 0.05)^5 = $231.36, which is closest to option B.

The Present Value of $300 Received 5 Years in the Future