Yuo are going to be given $45,000 in 7 years.Assuming an interest rate of 2.5%, what is the present value pf this amount?
+23254 The formula for future value is: PV = FV / (1 + r)^n
PV = Present Value FV = Future Value = 45000 n = number of compounding periods = 7
r = rate (as a decimal divided by the number of compounding periods per year) = .025
PV = 45000 / (1 + .025)^7 = $37,856.94
