The present value of $1 received 2 years from now,given the current interest rate of 8%,is about

Question

Quizplus · Accepted Answer

The present value (PV) of $1 received 2 years from now at an 8% interest rate can be calculated using the formula PV = FV / (1 + r)^n, where FV is the future value ($1), r is the annual interest rate (0.08), and n is the number of years (2). Plugging in the values gives PV = $1 / (1 + 0.08)^2 = $1 / (1.08)^2 = $1 / 1.1664 ≈ $0.86.

The Present Value of $1 Received 2 Years from Now,given