The Present Value of $10,000 Discounted at 5% Per Year

question 92

Multiple Choice

The present value of $10,000 discounted at 5% per year and received at the end of 5 years is

• A) $10,000/1.25.
• B) $10,000(1.05)5.
• C) $10,000/(1.05)5.
• D) $10,000 (1.05)1/5.

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Definitions:

Escalation of Commitment

The tendency to continue investing in a project or decision despite evidence of its failing, driven by emotional attachment or the desire to justify prior investments.

Persistent Failure

The ongoing inability to achieve success or meet objectives.

Long Term

Relating to or involving an extended period of time, typically emphasizing planning or thinking that takes into account the distant future rather than just immediate needs.

Z Problem-Solving Model

A decision-making framework that emphasizes a balanced view by considering multiple perspectives and sequenced steps to arrive at solutions.