You Are Expecting a Payment of C$100,000 Four Years from Now.The

question 97

Multiple Choice

You are expecting a payment of C$100,000 four years from now.The risk-free rate of return is 3.8 percent in the U.S.and 4.1 percent in Canada.The inflation rate is 2 percent in the U.S.and 3 percent in Canada.Suppose the current exchange rate is C$1 = $0.8273.How much will the payment four years from now be worth in U.S.dollars?

• A)$61,129
• B)$62,414
• C)$66,667
• D)$78,202
• E)$81,745

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Definitions:

Sensual Pleasures

Enjoyments derived from gratifying sensory experiences, often related to touch, taste, smell, sound, and sight.

Present

The current moment or period of time, distinct from the past and future.

Happiness

A state of well-being and contentment characterized by positive emotions and life satisfaction.

Fredrickson

Refers to Barbara Fredrickson, a psychologist known for her "broaden-and-build" theory of positive emotions.