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How much would you have to invest today to receive $12,000 in 6 years at 12 percent?

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How much would you have to invest today to receive:
a. $12,000 in 6 years at 12 percent?
b. $15,000 in 15 years at 8 percent?
c. $5,000 each year for 10 years at 8 percent?
d. $40,000 each year for 40 years at 5 percent?

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Solution Summary

This solution provides step by step calculations for the present values of single cash flow and annuities.

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PVIF= Present Value Interest Factor
PVIFA= Present Value Interest Factor for an Annuity

PVIFA( n, r%)= =[1-1/(1+r%)^n]/r%
PVIF( n, r%)= =1/(1+r%)^n

a. $12,000 in 6 years at 12 percent?

We will have to invest the PV of this amount

Rate=r= 12%
No of years=n= 6
Amount= $12,000.00
PVIF= (6 ...

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