If the Interest Rate Is 10 Percent, the Present Value

question 273

Multiple Choice

If the interest rate is 10 percent, the present value of a payment of $1,000 one year from today is

• A) $900.
• B) $909.
• C) $1,000.
• D) $1,100.

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Definitions:

Corporation By Estoppel

A defective corporation that has conducted business with a third party and therefore cannot deny its status as a corporation to escape liability.

Double Taxation

The imposition of two or more taxes on the same income, asset, or financial transaction, often referring to income taxed both at the corporate level and personally.

Excessive Taxation

Taxing beyond what is fair or reasonable, often perceived as placing undue burden on taxpayers.

S Corporation

A specialized form of corporation in the United States that allows income to be passed through to shareholders for federal tax purposes, avoiding double taxation.