What is the present value of $250,000.00, 10 years from now @ 6%?

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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What is the present value of $250,000.00, 10 years from now @ 6%?
 
Expert Solution
Step 1

The present value is the value of the sum received at time 0 or the current period. It is the value of the sum that will be received in the future period.

Step 2

Compute the present value of future sum, using the equation as shown below:

Present value=Future value1+RateTime=$250,0001+0.0610=$250,0001.79084769651=$139,598.694231

Hence, the present value of the future sum is $139,598.694231.

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