Luis Is Going to Receive $20,000 Six Years from Now

question 25

Multiple Choice

Luis is going to receive $20,000 six years from now.Soo Lee is going to receive $20,000 nine years from now.Which one of the following statements is correct if both Luis and Soo Lee apply a 7 percent discount rate to these amounts?

• A)The present values of Luis and Soo Lee's monies are equal.
• B)In future dollars, Soo Lee's money is worth more than Luis' money.
• C)In today's dollars, Luis' money is worth more than Soo Lee's.
• D)Twenty years from now, the value of Luis' money will be equal to the value of Soo Lee's money.
• E)Soo Lee's money is worth more than Luis' money given the 7 percent discount rate.

---

Definitions:

Measures

Tools or instruments used to assess, evaluate, or quantify certain variables or phenomena in research.

Factors

Variables or elements that contribute to a result or condition; these can be environmental, psychological, social, or biological in nature.

Freudian Ideas

Concepts and theories proposed by Sigmund Freud focusing on unconscious desires, childhood experiences, and the structure of the psyche (id, ego, and superego).

Personality Theory

A framework for understanding human thoughts, emotions, and behaviors that posits the existence of inherent, persistent psychological differences among individuals.