Dunston Company Will Receive £200,000 in a Future Year

question 43

Multiple Choice

Dunston Company will receive £200,000 in a future year. If the future receipt is discounted at an interest rate of 10%, its present value is £102,632. In how many years is the £200,000 received?

• A) 5 years
• B) 6 years
• C) 7 years
• D) 8 years

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Definitions:

Budget Constraint

The limitations on the consumers' ability to buy goods and services due to limited income and the prices of goods.

Income

Refers to the money received by a person or organization for work, from investments, or from various sources of revenue.

Budget Constraint

The limitations on the consumption patterns of individuals or firms due to limited financial resources.

Bell Peppers

Edible fruits from the Capsicum genus, often used in cooking for their sweet and mild flavor.