If the interest rate is 5 percent, what is the present value of $10,000 received three years from now?
A. 9530.35
B. 8075.50
C. 8638.38
D. 7550.75
Answer: C. 8638.38
Calculation: PV=FV*(1+i)^(-n)
PV=present value
FV=future value
i=interest rate
n=years
PV=10000*(1+0.05)^(-3)
=8638.37599
=8638.38
the PV is $8638.38
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