Monica wants to sell her share of an investment to Barney for $50,000 in three years.If money is worth 6% compounded semiannually,what would Monica accept today?

Question

Quizplus · Accepted Answer

The present value of $50,000 in three years at 6% compounded semiannually is calculated using the formula for present value: PV = FV / (1 + r/n)^(nt). Here, FV = $50,000, r = 0.06, n = 2, and t = 3. This results in a present value of approximately $41,874.

Monica Wants to Sell Her Share of an Investment to Barney