You will receive $7,600 three years from now. The discount rate is 13 percent. a. What...

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You will receive $7,600 three years from now. The discount rateis 13 percent. a. What is the value of your investment two yearsfrom now? Multiply $7,600 × .885 (one year’s discount rate at 13percent). (Round your answer to 2 decimal places.) b. What is thevalue of your investment one year from now? Multiply your roundedanswer to part a by .885 (one year’s discount rate at 13 percent).(Round your answer to 2 decimal places.) c. What is the value ofyour investment today? Multiply your rounded answer to part b by.885 (one year’s discount rate at 13 percent). (Round your answerto 2 decimal places.)

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3.8 Ratings (429 Votes)

a)Value of investment two years from now = PVF13%,1*Value in 3 years

= .88496*7600

= 6725.70

value of your investment one year from now = PVF13%,2*Value in 3 years

= .78315*7600

= 5951.91

Value of investment today =PVF13%,3*Future value

= .69305*7600

= 5267.18

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You will receive $7,600 three years from now. The discount rateis 13 percent. a. What is the value of your investment two yearsfrom now? Multiply $7,600 × .885 (one year’s discount rate at 13percent). (Round your answer to 2 decimal places.) b. What is thevalue of your investment one year from now? Multiply your roundedanswer to part a by .885 (one year’s discount rate at 13 percent).(Round your answer to 2 decimal places.) c. What is the value ofyour investment today? Multiply your rounded answer to part b by.885 (one year’s discount rate at 13 percent). (Round your answerto 2 decimal places.)