Question

Today, Li has $900,000 (treat this as a cash inflow) in an account that gives an 8% return each year. He has been investing $7,000 a year at the end of each year for 30 years. How much did he have in his account 30 years ago

Answer 1

The present value should be $10,635.116

Step-by-step explanation:

The computation of the present value is given below:

Interest rate i.e. RATE should be 8%

PMT is $7,000

NPER is 30

FV is $900,000

The formula is given below:

=-PV(RATE,NPER,PMT,FV,TYPE)

After applying the above formula, the present value should be $10,635.116