Discounted at 6%, $1,000 received three years from now is worth less than $800 received today.
PV = FV × PV_IF (App B: 3 periods, 6%)
= $1,000 × .840 = $840

Name: Discounted at 6%, $1,000 received three years from now is worth less than $800 received today. PV = FV × PV IF (App B: 3 periods, 6%) = $1,000 × .840 = $840
Brand: Quizplus
Rating: 4.7 (33 reviews)

Question

Discounted at 6%, $1,000 received three years from now is worth less than $800 received today. PV = FV × PV_IF (App B: 3 periods, 6%) = $1,000 × .840 = $840

Quizplus · Accepted Answer

The statement is false because the PV of $1,000 received three years from now discounted at 6% is $840, which is greater than the $800 received today.

Discounted at 6%, $1,000 Received Three Years from Now Is