With an Interest Rate of 6 Percent,the Present Value of $100

question 21

Multiple Choice

With an interest rate of 6 percent,the present value of $100 received one year from now is approximately

• A) $106.
• B) $100.
• C) $94.
• D) $92.

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Definitions:

Equipment Costing

The process of tracking and analyzing the costs associated with the purchase and maintenance of equipment.

Cash Equivalent

Short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value.

Maturity Date

The specified date on which the principal amount of a bond or other financial instrument is due to be repaid.

Interest Rate Changes

Variations in the cost of borrowing or the return on savings that occur due to economic policy or market conditions.