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Present Value and Investment Calculations

Question 20: (1 point)
(Ignore income taxes in this problem.) At an interest rate of 19%, approximately how much would you need to invest today if you wanted to have $2,600,000 in 11 years? (Round "PV Factor" to 3 decimal places.)


Solution Preview

Future value= Present value*(1+r)^n
Present value= 2600000/(1+19%)^11
=$384,800 =Answer

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Solution Summary

This provides the steps to calculate the Present value