7- You will receive $6,500 three years from now. The discount rate is 8 percent.

a.What is the value of your investment two years from now? Multiply $6,500 (1/1.08) or divide by 1.08 (one year's discount rate at 8 percent).

b.What is the value of your investment one year from now? Multiply your answer to part a by (1/1.08).

c.What is the value of your investment today? Multiply your answer to part b by (1/1.08)

d.Use the formula PV = FV (1/(1+i)n) to find the present value of $6,300 received three years from now at 8 percent interest.