Clint Just Won a Prize That Will Pay Him $30,000

question 100

Multiple Choice

Clint just won a prize that will pay him $30,000 a year for 30 years,starting at the end of Year 10.What is the current value of this prize if the discount rate is 12 percent,compounded annually?

• A)$241,655.52
• B)$240,550.64
• C)$87,143.40
• D)$86,191.91
• E)$77,806.61

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Definitions:

Money Demand Curve

A graph showing the relationship between the quantity of money people want to hold and the interest rate, inversely related.

Money Supply

The total amount of monetary assets available within an economy at a specific time, including cash, coins, and balances held in checking and savings accounts.

Interest Rate

The cost of borrowing money expressed as a percentage of the amount borrowed, paid to the lender.

Short Run

A time period in economics during which at least one input is fixed while others can be varied to adjust the level of output.