Sue needs to invest $3,626 today in order for her savings account to be worth $5,000 six years from now.Which one of the following terms refers to the $3,626?
A)Present value
B)Compound value
C)Future value
D)Complex value
E)Factor value

Question

Quizplus · Accepted Answer

The present value refers to the initial amount that needs to be invested to achieve a specific future value. In this case, Sue needs to invest $3,626 today, which is the present value, to achieve a future value of $5,000 after six years.

Sue Needs to Invest $3,626 Today in Order for Her