Question

The present value of paying $10,000 at the end of each year for 3 years and then $100,000 at the end of the 3rd year with a 12% interest per year equals $.
A) True
B) False

Answer 1

Answer:

$95,196.34

Explanation:

The answer to this question depends on the answer given, but it is not showing in this case so , find the present value of all the cashflows;

Recurring cashflow ; PMT= 10,000

Total duration; N =3

Interest per year; I/Y = 12%

Future value; FV = 100,000

then CPT PV = 95,196.337

The present value of these payments is $95,196.34