The Present Value of an Annuity That Pays $100 Each

question 11

True/False

The present value of an annuity that pays $100 each year indefinitely is $2,000 if the interest rate is 5 percent.

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Definitions:

Apprehension

Anxiety or fear that something bad or unpleasant will happen.

Stimulants

Substances that increase the activity of the nervous system to boost alertness, attention, and energy.

Increased Heart Rate

A condition where the heartbeat is faster than normal, which can be a response to exercise, stress, or health issues.

Confusion

A mental state characterized by disorientation regarding time, place, or identity, caused by a variety of medical, neurological, or psychological conditions.