Question 2.1: What is the present value of $1.00 to be received three time...
What is the present value of $1.00 to be received three time periods from now if the time value of money is 0.10 per period?
In Table A at the end of the book, the 0.10 column and the line opposite n equal to 3 gives 0.7513. If you invest $0.7513 to earn 0.10 per year, after three years you will have $1.00. Thus, (1.10)^{-3} = 0.7513.
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