## 3. What is the present value of single cash flow of $25,000 received at the end of 10 years, if we asume a discount rate of 5% annually With

Question

Lost your password? Please enter your email address. You will receive a link and will create a new password via email.

## Answers ( )

Answer:5% Discount:

$14,968.427% Discount:

$12,099.56Step-by-step explanation:Since the discount rate is being compounded annually we can go ahead and use the Exponential Growth Formula, or in this case we will actually be using the

Exponential Decay Formulasince we are compounding a discount rateWhere:

Dis the present valueais the initial cash flowris the discount rate in decimal formtis the span of timeSince we are looking for the present value in

10years with a rate of5%, we can plug these values into the formula and solve forD.So the Present day value at

5%discount rate is$14,968.42.Now we can solve the equation at a

7%discount rate.So the Present day value at

7%discount rate is$12,099.56I hope this answered your question. If you have any more questions feel free to ask away at Brainly.