What is the present equivalent of 1000SR to be received in 20 years when the interest...

Question

Question

What is the present equivalent of 1000SR to be received in 20 years when the interest rate is 10% per year compounded daily

Engineering Economy

sixteenth edition

William G. Sullivan

Answer 1

Answer #1

Presetn Worth of 1000SR is calculated as below

PW =1000/(1.1)^20=148.64SR on gross terms

Now if we compund it daily then PW can be

1000/(1+(10%/365))^(365*20)=135.3723 SR

Answer 2

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