CFIN
CFIN
5th Edition
ISBN: 9781305661639
Author: Scott Besley, Eugene Brigham
Publisher: Cengage Learning
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Chapter 4, Problem 7PROB
Summary Introduction

The future value is $2,500 due in 5 years at a 9% opportunity cost rate compounding annually, quarterly, and monthly.

Present value is the current value of future investment or series of future payments at a predetermined interest rate for a specified period.

PV=FV(1+rm)n×m

Here,

The present value is “PV”.

The future value is “FV”.

The interest rate is “r”.

The maturity period of time period is “n”.

The no of compounding is “m”.

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