Example1. Find Present value factor for Interest rate i = 10%, Compounded (n) = 3, using Compound Interest method
Solution:
i=10%=0.1 per year (Interest rate)
n=3 years (Number of periods)
Present value factor
PVF=1/(1+i)^n=(1+i)^-n
=(1+0.1)^-3
=(1.1)^-3
=0.7513
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