Present value Present dollars into the future Define R=amount to be received in future r=rate of return on investment T=years of investment The present value(Pv) of the investment is R PV= 1+r 88 Present Value: Present Dollars into the Future • Define – R=amount to be received in future – r=rate of return on investment – T=years of investment • The present value (PV) of the investment is: ( ) PV R r T = 1+