gldven2099 gldven2099

13-09-2022
Business

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brainly you found out that now you are going to receive payments of $7,500 for the next 16 years. you will receive these payments at the beginning of each year. the annual interest rate will remain constant at 14%. what is the present value of these payments?

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smecloudbird18 smecloudbird18

24-09-2022

53566 is the present value of these payments.

PVAn= 7500 x (1- 1 divided by (1+0.14)^16)

then it is divided by 0.14 =46988

PVA(DUE)n= 46988 x (1+0.14)= 53566

The idea of present value holds that a sum of money is worth more today than it will be in the future. In simple words, money received in the future is not as valuable as money which is received now. The value of $1,000 today is greater than $1,000 in five years.

The present value calculation can also be used to determine the value of a property today expected to earn at least the projected stream of cash flows in the future and the amounts which must be invested today in order to reap desired sums at later date.

To know more about present value here:

https://brainly.com/question/17322936

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