Respuesta :
Answer:
$175,590
Explanation:
To calculate the most that you should pay for this investment you have to find the present value using the formula:
PV = PMT*[(1-(1+r)^-n)/r]
PV = present value
PMT = payment amount: $25,000
r = interest rate: 7%
n = number of periods: 10
PV= 25,000*[(1-(1+0.07)^-10)/0.07]
PV= 25,000*[0.491651/0.07]
PV= 25,000*7.02358
PV= 175,590
The most that you should pay for this investment is: $175,590.
Answer:
The most you should pay for the investment is $175589.54
Explanation:
Given C = $25 000, n = 10 years, r = 7%, PV = ?
As we looking for the amount you should pay now to have 25 000 paid to your account for 10 years
PV = C ×{ 1 - (1+r)^-n/r}
= 25000×{1-(1+0.07)^-10/0.07}
=$175589.54
