Alice Says That the Present Value of $700 to Be

question 341

Multiple Choice

Alice says that the present value of $700 to be received one year from today if the interest rate is 6 percent is less than the present value of $700 to be received two years from today if the interest rate is 3 percent. Beth says that $700 saved for one year at 6 percent interest has a smaller future value than $700 saved for two years at 3 percent interest.

• A)Both Alice and Beth are correct.
• B)Both Alice and Beth are incorrect.
• C)Only Alice is correct.
• D)Only Beth is correct.

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Definitions:

Personality Themes

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College-educated Women

Women who have completed a degree at a college or university level, often associated with increased opportunities for professional and personal development.

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Refers to the period of adulthood approximately between the ages of 45 and 65, characterized by physical, psychological, and social changes, including the transition to late adulthood.

Career Change

The process of transitioning from one profession or occupational field to another, often involving retraining or updating of skills.