2. 2. How is the present value of a single sum (Appendix A) related to the present value of an annuity (Appendix D)?© BrainMass Inc. brainmass.com June 3, 2020, 6:06 pm ad1c9bdddf
1. The present value is the reciprocal of the future value. For example, if you take the Future Value of say year 3 and 10%, it is 1.331. The Present value under 10% and 3 years is 0.751 and the reciprocal of future value is 1/1.331=0.751. The ...
The solution explains the relationship between future value and present value of a single sum and an annuity