| An investment will pay you $23,000 in 7 years. The appropriate discount rate is 10 percent compounded daily. What is the present value? |
Multiple Choice
$11,802.64
$11,993.68
$10,851.43
$11,765.23
Ans $11,422.56
| FV = | Future Value |
| PV = | Present Value |
| r = | rate of interest |
| n= | no of period |
| PV = | FV/ (1 + r )^n |
| PV = | 23000 / ((1 + 10%/365)^2555) |
| PV = | 11422.56 |
| Where n = 7 years * 365 days = 2555 | |
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