Calculate the present value of $2,000 for each of the following: interest rate is 12%Show work the following way: PV factor from the table * $2,000 = Table factor Year 1: Year 3: Year 2: What is the sum of the present values? Why is the present value of an amount to be received in 3 years less than the amount to be received in one year? Calculate the future value of an annuity of $2,000 to be received over 40 years at 12%.
Calculate the present value of $2,000 for each of the following: interest rate is 12%Show work the following way: PV factor from the table * $2,000 = Table factor Year 1: Year 3: Year 2: What is the sum of the present values? Why is the present value of an amount to be received in 3 years less than the amount to be received in one year? Calculate the future value of an annuity of $2,000 to be received over 40 years at 12%.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Calculate the present value of $2,000 for each of the following: interest rate is 12%Show work
the following way: PV factor from the table * $2,000 = Table factor Year 1:
Year 3:
Year 2:
What is the sum of the present values? Why is the present value of an
amount to be received in 3 years less than the amount to be received in one year? Calculate
the future value of an annuity of $2,000 to be received over 40 years at 12%.
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