If security pays Rs 5,000 in 20 years with 7% annual interest rate, PV of security by using formula is
A. Rs 1,290.10
B. Rs 1,292.10
C. Rs 1,295.10
D. Rs 1,297.10
Answer: Option B
Solution (By Examveda Team)
Present Value = FV / ( 1 + r/100 )ⁿ= 5000 / ( 1 + 7/100)²⁰
= Rs. 1292.10
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