Present value=Cash flows*Present value of discounting factor(rate%,time period)
=3100/1.08^3+2600/1.08^5
which is equal to
=$4230.40(Approx).
Problem 5-5 Present Value (LG5-3) Compute the present value of a $3,100 deposit in year 3,...
Problem 5-5 Present Value (LG5-3) Compute the present value of a $2,500 deposit in year 3, and another $2,000 deposit at the end of year 5 if interest rates are 8 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.)
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