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1. What is the present value of a $500,000 inheritance (trust fund) to be received in...

1. What is the present value of a $500,000 inheritance (trust fund) to be received in 20 years discounted at an annual rate of 12%?

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Answer #1

FV =500000
PV =FV/(1+r)^n =500000/(1+12%)^20 =51833.38
PV of trust fund =51833.38

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