1. You have an investment opportunity that promises to pay you $20,000 at a future date. You can earn 5% compounded semiannually on similar investments. How much would you be willing to invest assuming you will receive the amount at the end of (a) three years, (b) four years, or (c) five years?

Formulas should include the =FV function and return a POSITIVE value.

Future value

$20,000

Additional amount received at the end of each semiannual period

$0

Interest rate

5%

Compounded semiannually

2

Compounding periods per year

Investment Term

Present Value

3

Years

4

Years

5

Years