What Is the Present Value of $150,000 to Be Received

question 29

Multiple Choice

What is the present value of $150,000 to be received 8 years from today if the discount rate is 11 percent?

• A)$65,088.97
• B)$71,147.07
• C)$74,141.41
• D)$79,806.18
• E)$83,291.06

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Definitions:

LIBOR

The London Interbank Offered Rate, a benchmark interest rate at which major global banks lend to one another in the international interbank market for short-term loans.

Euribor

The Euro Interbank Offered Rate, which is the benchmark rate of the average interest rate at which major global banks lend to one another.

Treasury Bond

A long-term, fixed-interest U.S. government debt security with a maturity of more than ten years.

Ask Price

The lowest price a seller is willing to accept for a security.