Present value for various discounting periods
Find the present value of $500 due in the future under each of these conditions:
9% nominal rate, semiannual compounding, discounted back 5 years. Round your answer to the nearest cent.
$
9% nominal rate, quarterly compounding, discounted back 5 years. Round your answer to the nearest cent.
$
9% nominal rate, monthly compounding, discounted back 1 year. Round your answer to the nearest cent.
$
Why do the differences in the PVs occur?
-Select-The present values decline as periods per year increaseThe present values decline as periods per year decreaseThe present values increase as periods per year increaseThe present values are not affected by changes in the number of periods per yearThe present values are positively related to the number of discounting periods per year.