Any future value can be discounted to a present value by dividing it by (1 + r)n, where r = (interest rate)/100, and n is the number of years in the future. Sometimes called present worth. This discounting reflects the cost of waiting to receive a future income. The further out the given amount of income is in the future, the less it’s worth to you now. Discounting is the reverse of compounding.
PRESENT VALUE
