Dontrall: Very good! So here's your next question: How is the present value of a single amount calculated? Noah: It can be calculated by rearranging the formula that is used in the calculation of a future value. To see this, ... Dontrall: Wait, wait, wait. Could you show me what you mean by writing this down? Here is a sheet of paper, show me how to rearrange the future value formula to solve for a present value. Noah: OK, first, let's write down the equation used to calculate a future value (FV). The Calculation of a Future Value Next, let's rearrange the equation to isolate the present value (PV) term by dividing both sides of the equation by the . Then, we'll simply rewrite the equation to put the unknown variable, the PV term, on the left-hand side of the equation. That is: FVX * = PV (1 + 1) PV = FV *( 1 (1 + I) So, does this make sense? We've rearranged the future value equation to solve for the present value. Also, notice that the present value interest factor is the of the future value interest factor. This means that you don't necessarily need two different interest factor tables for the single cash flow; you can make do using either simply the present value table or the future value table-so long as you use it correctly