Question

An investment will pay you $24,000 in 7 years. The appropriate discount rate is 6 percent compounded daily. What is the present value

Answer 1

$15,769.67

Step-by-step explanation:

The formula for determining present value is

FV x (1 + r/m)^-mn = P

FV = Future value

P = Present value = $24,000

R = interest rate = 6%

N = number of years = 7

m = number of compounding = 365

$24,000 x ( 1 + 0.06/365)^-365 x 7 = $15,769.67