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Find the present value of a security that will pay $2,500 in 4 years. The opportunity cost (interest rate that you could earn from alternative

Find the present value of a security that will pay $2,500 in 4 years.
The opportunity cost (interest rate that you could earn from alternative investments) is 5%.
a. Calculate using the PV formula.
b. Calculate using step-by-step (discounting year-by-year) approach.
Show and explain each step in detail.

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