Tina bought an investment that will pay her $4 million in 10 years. What is the...

Tina bought an investment that will pay her $4 million in 10 years. What is the present value of her investment if it earns 12% compounded monthly?

Expert Solution

PV = FV / (1 + r)^t

where, r = 0.12 / 12 = 0.01

t = 10 *12 = 120

PV = $4,000,000 / (1 + 0.01)^120

PV = $1,211,979.12

jeff jeffy answered 2 years ago

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