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3 years ago

What is the present value today of $2,300 received two years from now with a rate of return equal to 4%?

Business

1 answer:

Ierofanga [76]3 years ago

6 0

Answer:

present value = $2126.47

Explanation:

given data

future value = $2,300

time t = 2 year

rate of return r = 4%

solution

we get here present value that is express as

future value = present value × $(1+r)^{t}$ ..............1

put here value and we get

$2,300 = present value × $(1+0.04)^{2}$

present value = $\frac{2300}{1.04^2}$

present value = $2126.47

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