Question

How much would $10,000 due in 100 years be worth today if the discount rate were 10%?

A. $0.73
B. $1.21
D. $4.83
E. $6.30

Answer 1

The present value of $10,000 due in 100 years at a 10% discount rate is approximately $61.28.

Step-by-step explanation:

To calculate the present value of $10,000 due in 100 years with a discount rate of 10%, you can use the formula for present value:

Present Value = Future Value / (1 + Discount Rate)^n

Where Future Value is $10,000, Discount Rate is 10%, and n is the number of years (100).

Using this formula:

Present Value = $10,000 / (1 + 0.10)^100

Calculating this on a calculator or spreadsheet, the present value of $10,000 due in 100 years at a 10% discount rate is approximately $61.28.