Homework Help: present value

Posted by Don on Monday, July 14, 2008 at 11:11am.

The present value P that will amount to A dollars in n years with interest compounded annually at annual interest rate r, is given by P = A (1 + r) -^n. Find the present value that will amount to $50,000 in 20 years at 8% compounded annually.

present value - Reiny, Monday, July 14, 2008 at 11:37am
P = 50000(1.08)^-20
= ......

On your calculator
enter 50000 x 1.08 Y^X 20 ą =
to get 10,727.41

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