Name : Sinarino Wicaksono
NIM : 064.07.026
A businessman sell wallet. And the businessman has an opportunity to receive $300 two year from now. If he can earn 6% on his sale in the normal course of events, what is the most she should pay now for this opportunity?
We can know :
FV1 = $300, n = 2 and i = 0.06
PV = FVn/( 1 + i )^n
Answer :
PV = $300/(( 2 + 0.06 ))^2
= $70.7
The value today (“present value”) of $300 received two year from today, given an opportunity cost of 5% is $70.7
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