Find the present value of the investment. (Round your answer to the nearest cent.)
worth $10,000 after 4.5 years at 5.25% simple annual interest

To find the present value of an investment under simple interest, we use the following formula:

\[
PV = \frac{FV}{1 + rt}
\]

Where:
- $ PV $ is the present value (what we are solving for),
- $ FV $ is the future value, which is $10,000 in this case,
- $ r $ is the annual interest rate (as a decimal), 5.25% = 0.0525,
- $ t $ is the time in years, which is 4.5 years.

Now, plug in the values:

\[
PV = \frac{10,000}{1 + (0.0525 \times 4.5)}
\]

\[
PV = \frac{10,000}{1 + 0.23625}
\]

\[
PV = \frac{10,000}{1.23625}
\]

\[
PV \approx 8,089.78
\]

So, the present value of the investment is approximately **$8,089.78**.

Would you like more details or have any questions? 

Here are five related questions for practice:
1. What would the present value be with compound interest instead of simple interest?
2. How does the present value change if the interest rate increases to 6%?
3. If the investment period changes to 6 years, how would the present value be affected?
4. How would the future value change if the present value is $8,500 with the same interest rate and time period?
5. What would the present value be for a different future value of $12,000?

**Tip:** Simple interest is calculated only on the original principal, not on accumulated interest. For long-term investments, compound interest is typically more beneficial.

Find the present value of the investment worth $10,000 after 4.5 years at 5.25% simple annual interest.

Learn how to calculate the present value of a $10,000 investment after 4.5 years at a 5.25% simple annual interest rate. This example covers key financial math concepts like simple interest, present value, and algebraic calculations. Suitable for high school students.

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