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If the single amount of $400 is to be received in 2 years and discounted at...

If the single amount of $400 is to be received in 2 years and discounted at 12%, its present value is: (Round to the nearest dollar.)

12%, 2 years annually Factor
Present value of $1 0.797
Future value of $1 1.254
Present value of an annuity 1.690
Future value of an annuity 2.120


a. $502.
b. $319.    
c. $676.
d. $331.
e. None of the options listed

Please Help!

Thank you!

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Answer #1

Answer : b. $319

Calculated as

Present value factor of $1 = 0.797

Amount to be received in 2 years = $400

Present value today = $400 x 0.797 = $318.80 or $319 rounded off

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