Which of the Following Decisions Would Involve the Use of the Present

question 20

Multiple Choice

Which of the following decisions would involve the use of the present value of $1?

• A) Your brother buys your car and offers to pay you $500 per year for three years or $1,500 in two years.
• B) You win a lawsuit and are offered a lump-sum payment today of $100,000 or $15,000 a year for 20 years.
• C) Your father and mother wish to deposit enough money on the date of your high school graduation to enable you to take a $7,000 cruise when you graduate from college in 4 years.
• D) You want to have $1,000,000 in order to retire at age 55, but need to know how much you will need to deposit each year from now until your 55th birthday.

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Definitions:

Trisomy 21

A genetic disorder caused by the presence of an all or part of an extra 21st chromosome, known as Down syndrome.

Monosomy

A chromosomal disorder characterized by the absence of one chromosome from the normal diploid number.

Milestone

An important event or achievement that marks a significant stage or progress in a process, project, or development.

Germinal Prenatal Period

The initial stage of fetal development, covering the first two weeks after conception when the zygote undergoes cell division and implantation in the uterine wall.