You Are to Receive $12,000 at the End of 5

question 97

Multiple Choice

You are to receive $12,000 at the end of 5 years.The available yield on investments is 6%.Which table would you use to determine the value of that sum today?

• A) Present value of an annuity of $1
• B) Future value of an annuity
• C) Present value of $1
• D) Compound sum of $1

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Definitions:

Investment

The practice of apportioning financial resources aimed at generating earnings or profits.

Private Saving

The portion of households' income that is not spent on consumption or taxes, often put aside for future use or investment.

Private Saving

The amount of income that households save after accounting for their spending and taxes.

Investment

The allocation of resources, usually financial, into assets or projects expected to yield future profits or revenue.