(Present value tables required) Your grandfather has promised to give you $1,000 a year at the end of each of the next four years if you earn Cs or better in all of your courses each year.Using a discount rate of 6%,which of the following is correct for determining the present value of the gift?
A) PV = $1,000 × 6% × 4
B) PV = $1,000 × (PV factor,i = 4%,n = 6)
C) PV = $1,000 × (Annuity PV factor,i = 6%,n = 4)
D) PV = $1,000 × (Annuity FV factor,i = 6%,n = 4)
Correct Answer:
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