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GaryK [48]
3 years ago
14

determine the present value now of an investment of $3,000 made one year from now and an additional $3,000 made two years from n

ow if the annual discount rate is 4 percent.
Business
1 answer:
GrogVix [38]3 years ago
3 0

The present value of the investment is $5,658.29.

The present value is the value of an investment today. It is determined by adding the sum of the discounted cash flows of the investment.

Present value of year 1 cash flows= $3000 / 1.04 = $2,884.62

Present value of year 2 cash flows=$3000 / 1.04² = $2,773.67

Sum of the discounted cash flows = $2,773.67 + $2,884.62 = $5,658.29

A similar question was solved here: brainly.com/question/9641711?referrer=searchResults

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Explanation:

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Present value can be calculated using a financial calculator

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Cash flow in year 5 = $2,500

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To find the PV using a financial calculator:

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Neporo4naja [7]

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Answer:

"2000 units" is the right solution.

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