A day full of math games & activities. Find one near you.
A day full of math games & activities. Find one near you.
A day full of math games & activities. Find one near you.
A day full of math games & activities. Find one near you.
With an interest rate of 6 percent, the present value of $100 next year is approximately?
Solution:
Future value of an Investment at r% for n years is given by:
Future Value = Present Value (1 + r/100)ⁿ
Therefore the present value of a future value is given as
Present Value = Future Value/(1 + r/100)ⁿ
If r = 6% and n = 1. Here r becomes the discounting rate.
Present Value = 100/(1 + 6/100)¹
= 100/(1.06)¹
= 94.339
= $94.339
With an interest rate of 6 percent, the present value of $100 next year is approximately?
Summary:
The present value of $100 next year at 6% is $94.339.
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