What's the Present Value of $1,525 Discounted Back 5 Years

question 78

Multiple Choice

What's the present value of $1,525 discounted back 5 years if the appropriate interest rate is 6%, compounded monthly?

• A) $969
• B) $1,020
• C) $1,074
• D) $1,131
• E) $1,187

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Definitions:

Line-By-Line Method

A consolidation technique where the financial statements of the parent and its subsidiaries are combined by adding together like items of assets, liabilities, equity, income, and expenses.

Cash

Money in the form of bills or coins; represents the most liquid form of assets available.

Building

A structure with walls and a roof, such as a house or factory, designed for various uses.

Investment

Allocation of resources, such as capital or time, in the expectation of generating an income or profit.