document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1038543>Question 1038543</A>: <I><SPAN STYLE=\"word-break: break-all;\"> What is the present value (PV) of an investment that will pay $400 in one year's time, and $400 every year after that, when the interest rate is 5%? </SPAN>\n" );
document.write( "</I><HR><TABLE width=100%><TR><TD><B><A HREF=http://www.algebra.com/>Algebra.Com's</A> Answer #653246 by </B><A HREF=/tutors/aboutme.mpl?userid=Othel><B>Othel(27)</B></A><img src=\"/images/stars/stars-07.gif\" alt=\"\" >&nbsp;<A HREF=/tutors/aboutme.mpl?userid=Othel><IMG SRC=http://www.algebra.com/images/aboutme-small.gif BORDER=0 alt=\"About Me\" VALIGN=MIDDLE></A>&nbsp;<IMG SRC=http://www.algebra.com/images/nopicture.jpg><BR>You can <A HREF=\"/cgi-bin/embed-solution.mpl?show=1&solution=653246\">put this solution on YOUR website!</A><BR><SPAN STYLE=\"word-break: break-all;\"> We know that the interest rate is 5%, and that 5% of the money invested is $400.<BR>\n" );
document.write( "I think we must assume that the $400 made every year is paid out, and not added to the amount in the investment, so the present value remains the same throughout the years. <BR>\n" );
document.write( "So to put this in the form of a question, what number multiplied by .05 equals 400?<BR>\n" );
document.write( "And mathematically...<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=.05%2Ax=400 ALIGN=MIDDLE  ALT=\".05%2Ax=400\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "which is...<BR>\n" );
document.write( "<IMG STYLE=\"max-width:80%;\" SRC=/cgi-bin/plot-formula.mpl?expression=%28400%2F.05%29=x ALIGN=MIDDLE  ALT=\"%28400%2F.05%29=x\"   DISABLED_style= \"max-width:90%; height:auto;\" ><BR>\n" );
document.write( "The present value is $8000<BR>\n" );
document.write( "Check your answer! <BR>\n" );
document.write( "I hope this helps! Learn on </SPAN>\n" );
document.write( "</TD></TR></TABLE>\n" );