What Is the Present Value Today of $150 That Will

question 131

Multiple Choice

What is the present value today of $150 that will be received in four years from now if the discount rate is 12%?

• A)$76.03
• B)$95.33
• C)$116.90
• D)$105.60
• E)$83.39

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Definitions:

Interest Rate

The proportion of a total amount of money that is levied for borrowing it, usually stated as an annual rate.

Annual Return

The percentage of gain or loss on an investment over a one-year period, taking into account both capital gains and dividends.

Retirement Fund

Financial resources that have been saved and are used to support a person's retirement.

Mutual Fund

An investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments.