If you are offered 

​$300,000 

in 

13

years and you can earn 

11

percent on your​ money, what is the present value of 

​$300,000​?

To find the present value (PV) of \$300,000 that you will receive in 13 years, with an interest rate of 11%, we use the present value formula:

\[
PV = \frac{FV}{(1 + r)^n}
\]

Where:
- $ PV $ is the present value (what we are solving for),
- $ FV $ is the future value (\$300,000),
- $ r $ is the annual interest rate (11% or 0.11),
- $ n $ is the number of years (13).

Substitute the given values:

\[
PV = \frac{300,000}{(1 + 0.11)^{13}}
\]

Now, let's calculate the present value.

The present value of \$300,000 to be received in 13 years, with an interest rate of 11%, is approximately **\$77,254.28**.

Would you like more details or have any questions? Here are some follow-up questions:

1. How does the time period affect the present value of money?
2. What happens to the present value if the interest rate increases?
3. Can you use this formula for continuous compounding?
4. How is present value applied in real-world financial decisions?
5. What if the amount were received in smaller periodic payments over time?

**Tip:** The higher the interest rate or the longer the time period, the lower the present value of a future sum.

If you are offered $300,000 in 13 years and you can earn 11 percent on your money, what is the present value of $300,000?

Calculate the present value of $300,000 that will be received in 13 years with an interest rate of 11%. This finance problem uses the time value of money formula to determine that the present value is approximately $77,254.28.

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