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Michelle Romero
on Nov 13, 2024

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The present value of $40,000 to be received in two years, at 12% compounded annually, is (rounded to nearest dollar)

A) $31,888
B) $48,112
C) $8,112
D) $40,000

Present Value

The present valuation of money to be received in the future or recurrent cash inflows, accounting for a chosen rate of interest.

Compounded Annually

Interest on an investment or loan calculated once a year, where each year's interest payment includes interest on the original principal and on the accumulated interest of previous periods.

  • Understand the concept and calculation of present value for future cash flows.
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mazed mohamedNov 19, 2024
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