Using the Following Table, What Is the Present Value of $40,000

question 45

Short Answer

Using the following table, what is the present value of $40,000 to be received in 5 years, if the market rate is 7% compounded annually? $$\begin{array} { | l | c | c | c | c | } \hline \text { Periods } & 5 \% & 6 \% & 7 \% & 10 \% \\\hline 1 & 0.95238 & 0.94340 & 0.93458 & 0.90909 \\\hline 2 & 0.90703 & 0.89000 & 0.87344 & 0.82645 \\\hline 3 & 0.86384 & 0.83962 & 0.81630 & 0.75132 \\\hline 4 & 0.82270 & 0.79209 & 0.76290 & 0.68301 \\\hline 5 & 0.78353 & 0.74726 & 0.71299 & 0.62092 \\\hline 6 & 0.74622 & 0.70496 & 0.66634 & 0.56447 \\\hline 7 & 0.71068 & 0.66506 & 0.62275 & 0.51316 \\\hline 8 & 0.67684 & 0.62741 & 0.58201 & 0.46651 \\\hline 9 & 0.64461 & 0.59190 & 0.54393 & 0.42410 \\\hline 10 & 0.61391 & 0.55840 & 0.50835 & 0.38554 \\\hline\end{array}$$

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Definitions:

Mood Disorders

Psychological disorders characterized by the elevation or lowering of a person's mood, such as bipolar disorder or major depression.

Opioid Abuse

The misuse of opioid drugs, including prescription painkillers and illicit substances like heroin, often leading to addiction, health problems, or overdose.

Bulimia Nervosa

An eating disorder characterized by episodes of binge eating followed by behaviors such as vomiting to prevent weight gain.

Substance Abuse

Engaging in harmful or dangerous activities involving psychoactive substances, including the use of alcohol and illegal drugs.