If the Annual Interest Rate Is I,the Present Value of $X

question 6

Multiple Choice

If the annual interest rate is i,the present value of $X to be received at the end of each of the next n years is:

• A) $X/i.
• B) $X/(1 + i)ⁿ.
• C) \( \$ X \sum_{t=1}^{n} 1 /(1+i)^{t} \)
• D) $X[(1 + i)ⁿ] / [ i(1 + i)ⁿ - 1].
• E) $X / [i(1 + i)ⁿ - 1].

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Definitions:

Personal Property

Assets or belongings that are not attached to or part of real estate; movable property.

Chattel

Tangible personal property that is movable as opposed to real property or real estate.

Patent

A legal right granted by a government to an inventor, giving exclusive rights to the patented process, design, or invention for a certain period.

Realty

Refers to real property, including land and any structures on it, as well as the rights associated with the ownership of this land and structures.