Below is a table for the present value of $1 at compound interest. Year 6% 10% 12% 1 0.943 0.909 0.893 2 0.890 0.826 0.797 3 0.840 0.751 0.712 4 0.792 0.683 0.636 5 0.747 0.621 0.567 Below is a table...


Below is a table for the present value of $1 at compound interest.









































Year

6%

10%

12%
10.9430.9090.893
20.8900.8260.797
30.8400.7510.712
40.7920.6830.636
50.7470.6210.567




Below is a table for the present value of an annuity of $1 at compound interest.











































Year

6%

10%

12%
10.9430.9090.893
21.8331.7361.690
32.6732.4872.402
43.4653.1703.037
54.2123.7913.605


Using the tables above, if an investment is made now for $20,000 that will generate a cash inflow of $8,000 a year for the next four years, what would be the net present value (rounded to the nearest dollar) of the investment, assuming an earnings rate of 10%?


a.$25,360

b.$14,536

c.$5,464

d.$5,360



Jun 05, 2022
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