The present value o.pdf

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The present value of $5,000 per year for three y FVA of $1 (Use appropriate factor(s) from the to True or False True Folse Solution True ,Present value = $5000 * PVAF (12%,3 years) = $5000 * 2.4018 = $5000 * 2.4018 = $12009 Note:- PVAF(12%,3 years) = [1 - (1+0.12)-3*1] / [0.12] =[1 - (1.12)-3] / 0.12 =[1 - 1/(1.12)3] / 0.12 =[1 - 1/1.404928] / 0.12 =0.288220/ 0.12 = 2.4018 So , PVAF(12%,3 years) = 2.4018.

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=[1 - 1/(1.12)3] / 0.12
=[1 - 1/1.404928] / 0.12
=0.288220/ 0.12
= 2.4018
So , PVAF(12%,3 years) = 2.4018

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