Which of the Following Best Expresses the Present Value of $500

question 46

Multiple Choice

Which of the following best expresses the present value of $500 that you have to wait four years and three months to receive?

• A) ($500/4.25) × (1 + i)
• B) $500 × 4.25 × (1 + i)
• C) $500/(1 + i)⁴.²⁵
• D) ($500/4) × (1 + i)³

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Definitions:

Operant Conditioning

A learning process in which the strength of a behavior is modified by reinforcement or punishment.

Acquisition Procedures

Methods or processes used in learning or obtaining new information, skills, or responses.

Classical Conditioning

A learning process that creates new associations between neutral stimuli and reflex-causing stimuli, famously demonstrated by Pavlov's dogs.

Operant Conditioning

An educational practice that modifies the strength of a behavior through either positive stimuli or negative feedback.