You Have an Investment Opportunity That Will Cost $1,000 Today

question 61

Multiple Choice

You have an investment opportunity that will cost $1,000 today and promises cash flows of $25 in 6 months, $25 in 12 months, $25 in 18 months, and $1,025 at the end of two years. If you
Could earn an APR of 6% on alternative investments, what is this investment's net present
Value? Round your answer to the nearest dollar.

• A)+$981
• B)-$19
• C)+$18
• D)-$121

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Definitions:

Percent More

A term used to describe how much one quantity is larger than another as a percentage of the second quantity.

Increased By

A term used to indicate that a quantity is being added to, or grown in value or amount.

Increased By

Refers to the process of adding a certain amount or percentage to an original value, resulting in a higher final amount.

Decrease Of

A reduction or decline in value, number, or amount.