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use the formula present value = (future value)/(1 + r)n, where n is the number of years, and r is the annual interest rate.
3. From the perspective of year 1 /1/2010, the future value on 1/1/2012 is $5,500. If the interest rate in year 2012 is r, the future value on 1/1/2013 is ______.
4. The future value is X, calculated assuming an interest rate = .08, and a present value of $3,000. If the actual interest rate equals .06, and the future value is X, then what is the present value.

Econometrics, Economics

  • Category:- Econometrics
  • Reference No.:- M9488590

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