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zysi [14]
3 years ago
7

What is the value today of receiving $5,000 at the end of six years, assuming an interest rate of 8% compounded semiannually?

Business
1 answer:
Ulleksa [173]3 years ago
6 0

Answer:

$3,122.96

Explanation:

Future value = 5000

i = 8%

n = 6

m = 2

Present Value = FV(1+i/m)^mn

Present Value = 5,000(1+0.08/2)^-2*6

Present Value = 5,000(1.04)^-12

Present Value = 5,000 / (1.04)^12

Present Value = 5,000 / 1.6010322

Present Value = 3122.985284118583

Present Value = $3,122.96

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