Discounted at 10%, $1,000 received at the end of each year for three years is worth less than $2,700 received today.
PV_A = A × PV_IFA (App. D: 3 periods, 10%)
= $1,000 × 2.487 = $2,487

Question

Discounted at 10%, $1,000 received at the end of each year for three years is worth less than $2,700 received today. PV_A = A × PV_IFA (App. D: 3 periods, 10%) = $1,000 × 2.487 = $2,487

Quizplus · Accepted Answer

The present value of $1,000 received at the end of each year for three years at a 10% discount rate is $2,487, which is less than $2,700 received today.

Discounted at 10%, $1,000 Received at the End of Each