Answer:
Present value investment = $98.05
Explanation:
given data
present value = $100
time 1 = 6 months = [tex]\frac{6}{12}[/tex] = 0.5 year
time 2 = 5 years
time 3 = 10 years
interest rate = 4 % = 0.04
to find out
Present value investment in 6 month for the rate 4 percent
solution
we get here Present value investment by as
Present value investment = present value ÷ [tex](1+r)^{t}[/tex] ..............1
put here value and we get
Present value investment = [tex]\frac{100}{(1+0.04)^{0.5}}[/tex]
solve it we get
Present value investment = [tex]\frac{100}{1.0198}[/tex]
Present value investment = $98.05
