Amanda Is Considering One of Two Options

question 123

Multiple Choice

Amanda is considering one of two options. The first option is to receive $48,000 now. The second option is to receive $75,000 at the end of the fifth year. Determine which option should be chosen to maximize benefits now given an interest rate of 8.8% compounded annually.

• A) Second option, as it provides benefit of $54,194.53 compared to $48,000 for second
• B) Second option, as it provides benefit of $53,194.53 compared to $48,000 for second
• C) Second option, as it provides benefit of $52,194.53 compared to $48,000 for second
• D) Second option, as it provides benefit of $51,194.53 compared to $48,000 for second
• E) Second option, as it provides benefit of $49,194.53 compared to $48,000 for second

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Definitions:

Depression

An ailment in emotional health marked by consistent depressive emotions or detachment from pleasures, leading to significant obstructions in day-to-day life.

Motivational Symptom

A symptom manifesting in decreased desire or drive to engage in previously pleasurable activities, often seen in various psychological disorders.

Unipolar Depression

A profound depressive disorder identified by perpetual feelings of sorrow or an indifference to the external environment.

Persistent Depressive Disorder

A chronic form of unipolar depression marked by ongoing and repeated symptoms of either major or mild depression.