document.write( "<A HREF=/cgi-bin/jump-to-question.mpl?question=1127157>Question 1127157</A>: <I><SPAN STYLE=\"word-break: break-all;\"> Calculate the present value, to the nearest cent, for each of the following:\r<BR>\n" );
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document.write( "a) Future value = $34000, Interest rate = 4% p.a, Time period = 4 years </SPAN>\n" );
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document.write( "I'm assuming you're compounding the interest once per year.\r<BR>\n" );
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document.write( "The formula to use is<BR>\n" );
document.write( "PV = FV/((1+r)^n)<BR>\n" );
document.write( "where,<BR>\n" );
document.write( "PV = present value = unknown<BR>\n" );
document.write( "FV = future value = 34,000<BR>\n" );
document.write( "r = 0.04 which is the decimal form of 4%<BR>\n" );
document.write( "n = number of years = 4\r<BR>\n" );
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document.write( "So,<BR>\n" );
document.write( "PV = FV/((1+r)^n)<BR>\n" );
document.write( "PV = (34,000)/((1+0.04)^4)<BR>\n" );
document.write( "PV = (34,000)/((1.04)^4)<BR>\n" );
document.write( "PV = (34,000)/(1.16985856)<BR>\n" );
document.write( "PV = 29,063.3424950107<BR>\n" );
document.write( "<font color=red>PV = 29,063.34 dollars</font><BR>\n" );
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