The Present Discounted Value of $100 Payable 1 Year from Now

question 8

Multiple Choice

The present discounted value of $100 payable 1 year from now, assuming a market rate of interest of 10 percent, is:

• A)$100.
• B)$10.
• C)$90.
• D)slightly less than $90.
• E)slightly more than $90.

---

Definitions:

Intermediate Products

Goods that are produced in one manufacturing process but are used as inputs in another, not yet final products.

Common Input

A resource, such as raw materials or labor, that is shared among different processes or production lines within manufacturing or service delivery.

Further Processing

Additional operations carried out on a product to enhance its value before final sale.

Split-off Point

The stage in a production process where multiple products are generated from a common input and can further be processed or sold separately.