Find the present value PV of the given investment (in dollars). (Round your answer to the nearest cent.)
An investment earns 6% per year and is worth $50,000 after 3 years.
PV = $

To calculate the present value (PV) of an investment, we use the formula for compound interest in reverse:

\[
PV = \dfrac{FV}{(1 + r)^t}
\]

Where:
- $FV$ is the future value (in this case, $50,000),
- $r$ is the annual interest rate (6%, or 0.06),
- $t$ is the time in years (3 years).

Substituting the given values:

\[
PV = \dfrac{50,000}{(1 + 0.06)^3}
\]

First, calculate $1 + 0.06 = 1.06$, then raise it to the power of 3:

\[
1.06^3 = 1.191016
\]

Now, divide the future value by this amount:

\[
PV = \dfrac{50,000}{1.191016} \approx 42,000.67
\]

Thus, the present value (PV) is approximately **$42,000.67**.

Would you like further details or clarifications?

Here are some related questions you might find helpful:
1. How would the PV change if the interest rate was 5% instead of 6%?
2. What is the formula for continuous compound interest?
3. How does inflation impact the present value of money?
4. How do you calculate the future value (FV) given the present value and interest rate?
5. How would the time period affect the present value?

**Tip:** Remember, the present value tells you how much you would need to invest today to reach a future value, considering the interest rate and time.

Find the present value PV of the given investment (in dollars). An investment earns 6% per year and is worth $50,000 after 3 years.

Calculate the present value (PV) of an investment worth $50,000 after 3 years at an interest rate of 6%. Learn the steps using the compound interest formula to determine the present value of future investments.

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