To the nearest dollar, what is the value today of an investment that pays $15,000 in seven years, assuming an annual opportunity cost of 9%?
A) $7,473
B) $27,421
C) $8,206
D) $7,130
E) None of the above

Question

Quizplus · Accepted Answer

We can use the present value formula: PV = FV / (1 + r)^n, where PV is the present value, FV is the future value, r is the opportunity cost, and n is the number of years. 
Plugging in the given values: PV = 15,000 / (1 + 0.09)^7 = $8,205.59, which rounded to the nearest dollar is $8,206. Thus, the best choice is C.

To the Nearest Dollar, What Is the Value Today of an Investment