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Present Value of Amounts Due Assume that you are going to receive $750,000 in 10...

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Accounting

Present Value of Amounts Due

Assume that you are going to receive $750,000 in 10 years. The current market rate of interest is 7%.

a. Using the present value of $1 table in Exhibit 5, determine the present value of this amount compounded annually. Round to the nearest whole dollar. $

b. Why is the present value less than the $750,000 to be received in the future? The present value is less due to over the 10 years.

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