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Sagot :
You have to invest today $26,019.48 at 4.5ompounded annually to have $32,425 available for the purchase of a car at the end of five years from now.
It is calculated as follows:
The formula for calculating present value is:
PV = FV(1 + r)^-n
where:
FV = Future value = 32425
P = Present value
R = interest rate = 4.5
N = number of years = 5 years
$32,425(1.045)^-5 = $26,019.48
Present value or PV is the current value of a future sum of money or any stream of cash flows giving a specified rate of return.
To know more about present value here:
https://brainly.com/question/17322936
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