If I will receive a payment of $121 two years from now and the annual interest rate is 10 percent, the present value of the paym
ent is:
1 answer:
Answer:
$100
Explanation:
The present value of a cash flow can be found by discounting the cash flow at the annual interest rate.
The formula for finding present value can be found in the attached image.
The present value can be calculated using a financial calculator.
Cash flow in year one = 0
Cash flow in year two = $121
Discount rate = 10%
Present value = $100
I hope my answer helps you
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Answer
The answer and procedures of the exercise are attached in the following archives.
Step-by-step explanation:
You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.
