Agriculture Reference
In-Depth Information
Table 13.2 Present value of $1 (compounded annually)
Year
(1 + i ) -n
(N)
1 %
3 %
5 %
6 %
7 %
1
0.9901
0.9709
0.9524
0.9434
0.9346
2
0.9803
0.9426
0.9070
0.8900
0.8734
3
0.9706
0.9152
0.8638
0.8396
0.8163
4
0.9610
0.8885
0.8227
0.7921
0.7629
5
0.9515
0.8626
0.7835
0.7473
0.7130
6
0.9420
0.8375
0.7462
0.7050
0.6663
7
0.9327
0.8131
0.7107
0.6651
0.6228
8
0.9235
0.7894
0.6768
0.6274
0.5820
9
0.9143
0.7664
0.6446
0.5919
0.5439
10
0.9053
0.7441
0.6139
0.5584
0.5083
15
0.8613
0.6419
0.4810
0.4173
0.3624
20
0.8195
0.5537
0.3769
0.3118
0.2584
25
0.7798
0.4776
0.2953
0.2330
0.1842
Year
(1 + i ) -n
(N)
8 %
9 %
10 %
12 %
14 %
1
0.9259
0.9174
0.9091
0.8929
0.8772
2
0.8573
0.8417
0.8264
0.7972
0.7695
3
0.7938
0.7722
0.7513
0.7118
0.6750
4
0.7350
0.7084
0.6830
0.6355
0.5921
5
0.6806
0.6499
0.6209
0.5674
0.5194
6
0.6302
0.5963
0.5645
0.5066
0.4556
7
0.5835
0.5470
0.5132
0.4523
0.3996
8
0.5403
0.5019
0.4665
0.4039
0.3506
9
0.5002
0.4604
0.4241
0.3606
0.3075
10
0.4632
0.4224
0.3855
0.3223
0.2697
15
0.3152
0.2745
0.2394
0.1827
0.1401
20
0.2145
0.1784
0.1486
0.1037
0.0728
25
0.1460
0.1160
0.0923
0.0588
0.0378
In other words, if the relative invests $822.70 today at 5 percent interest, compounded annu-
ally, that investment will be worth $1,000 in four years.
Annuities
Annuities are a stream of incomes and/or costs that are equal amounts for each of the number
of periods evaluated. The time value of money concept can then be used to determine the
 
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