What is the present value

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Howard can borrow against future income at a 6 percent rate of interest, and he can earn 6 percent on his savings. His rich uncle has given him the choice between $20,000 now or $25,000 in three years. If he put it all in his savings acount, how much would the original $20,000be worth in three years? What is the present value of the $25,000? Which option should Howard choose?

Reference no: EM13159332

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