Answer:
the present value is $4,286.69
Explanation:
The computation of the sum received today is shown below:
As we know that
Present value = Future value ÷ (1+rate of interest)^number of years
= $5,000 ÷ (1 + 0.08)^2
= $5,000 ÷ 1.1664
= $4,286.69
hence, the present value is $4,286.69
We simply applied the above formula so that the correct value could come
And, the same is to be considered
