Answer:
$4,198.10
Explanation:
Compounding and discounting are the methods used to determine the present and future value of money.
Compounding shows the Future value of an amount today while discounting shows the present value of a future amount.
Fv = Pv ( 1 + r )^n
where
Fv = Future value
Pv = Present value
r = discount rate
n = time
5000 = Pv ( 1 + 0.06)^3
Pv = 5000(1.06)^-3
= $4,198.10
