Number of years = n = 8
Interest rate = r = 0.06
Payment per period = P = 1000
The present value can be calculated by the following formula:
[tex]PV =P (\frac{1-(1+r)^{-n} }{r}) [/tex]
Using the values, we get:
[tex]PV=1000( \frac{1-(1+0.06)^{-8} }{0.06} )=6209.79[/tex]
Thus, the present value will be $6209.79
