What is the present value of $7,500 to be received in 8 years if 6% is the proper discount rate?
A)$46,573.45
B)$4,705.59
C)$4,726.27
D)$11,953.86

Question

Quizplus · Accepted Answer

The present value (PV) can be calculated using the formula PV = FV / (1 + r)^n, where FV is the future value ($7,500), r is the discount rate (6% or 0.06), and n is the number of periods (8 years). Plugging in the values, PV = $7,500 / (1 + 0.06)^8 = $4,705.59.

What Is the Present Value of $7,500 to Be Received