Asked by Katie McFarland on Jul 12, 2024
Verified
A payment of $10,000 is to be made in the future. The interest rate 3%. Is this payment worth more if it is paid in 5 years or 10 years? How much more is it worth?
Interest Rate
The expense associated with lending funds or the profit gained from investments, usually represented as a percentage.
- Absorb the methods for calculating financial values in the present and future through computation.
Verified Answer
MF
Madison FlowersJul 18, 2024
Final Answer :
It is worth more if it is received in 5 years. It's worth about $8626.09 if it is paid in 5 years and $7440.94 if it is paid in ten years. So, its worth about $1185.15 more if its paid in 5 years rather than 10.
Learning Objectives
- Absorb the methods for calculating financial values in the present and future through computation.