If You Are to Receive a Payment of $200 at the End

question 87

Multiple Choice

If you are to receive a payment of $200 at the end of the first year and a payment of $250 at the end of the second year at a market interest rate of 5 percent,the present value of this income stream is _____

• A)$400.37.
• B)$417.23.
• C)$450.00.
• D)$475.37.
• E)$490.13.

---

Definitions:

Wage Earners

Individuals who receive a regular payment in exchange for their labor or services, usually calculated by the hour, day, or week.

Factory System

A method of manufacturing using machinery and division of labor, leading to mass production but also significant changes in society and the economy.

Machinery Use

Refers to the employment of machines to perform work or tasks, often used to increase efficiency, productivity, and precision in industries and agriculture.

Labor Organization

A group, often in the form of a union, that represents the collective interests of workers in negotiations with employers regarding wages, working conditions, and rights.