Question

**(b)** What is the present value of $30,500 to be
received at the end of each of 7 periods, discounted at 9%?
*(Round answer to 2 decimal places, e.g.
25.25.)*

Answer #1

**The Answer is $153,505.06**

**Calculation of Present Value**

Note - 9% can also be written as 0.09

How did we calculate the discounting factors @9%

Period 1

= 1/1.09

= 0.9174

Period 2

= 0.9174 / 1.09

= 0.8417

Period 3

= 0.8417 / 1.09

= 0.7722

Period 4

= 0.7722 / 1.09

= 0.7084

Period 5

= 0.7084 / 1.09

= 0.6499

Period 6

= 0.6499 / 1.09

= 0.5963

Period 7

= 0.5963 / 1.09

= 0.5470

(a) What is the present value of $29,400 due 8
periods from now, discounted at 6%? (Round answer to 2
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(b) What is the present value of $29,400 to be
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(Round answer to 2 decimal places, e.g.
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