Of the Following Investments, Which Would Have the Lowest Present

question 1

Multiple Choice

Of the following investments, which would have the lowest present value? Assume that the effective annual rate for all investments is the same and is greater than zero.

• A) Investment A pays $250 at the end of every year for the next 10 years (a total of 10 payments).
• B) Investment B pays $125 at the end of every 6-month period for the next 10 years (a total of 20 payments).
• C) Investment C pays $125 at the beginning of every 6-month period for the next 10 years (a total of 20 payments).
• D) Investment D pays $2,500 at the end of 10 years (just one payment).
• E) Investment E pays $250 at the beginning of every year for the next 10 years (a total of 10 payments).

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Definitions:

Environmental Factors

Elements within the external surroundings that can influence an organism's development, behavior, and survival.

Anorexia Nervosa

A psychological and potentially life-threatening eating disorder characterized by an extremely low body weight, an intense fear of gaining weight, and a distorted perception of body weight and shape.

Bulimia Nervosa

An eating disorder characterized by binge eating followed by purging to avoid weight gain.

Eating Disorders

Mental health disorders characterized by abnormal or disturbed eating habits, which significantly impair health or wellbeing.