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Serga [27]
4 years ago
12

The 2-year discount factor is 0.92.

Business
1 answer:
lora16 [44]4 years ago
3 0

Answer:

a. $0.92

b. $1,840

Explanation:

a. 2 year discount factor is 0.92

Present value of $1 to be received in 2 years =

$1 * discount factor

Present value = $1 * 0.92

Present value = $0.92

b. Present value of $2000 can also be calculated in the same manner by using the 2 year discount factor.

Present value = $2000 * 0.92

Present value = $1,840

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