What Is the Present Discounted Value of $400 a Year

question 28

Multiple Choice

What is the present discounted value of $400 a year from now and $500 two years from now if the interest rate is 10%?

• A) $676.18
• B) $743.80
• C) $818.18
• D) $776.86

---

Definitions:

Percentage

A portion of a whole expressed as a fraction of 100, used to describe proportions or compare quantities.

Gross Collection Ratio

A financial metric that measures the total amount of revenue collected versus the total amount charged.

Chronological Order

The arrangement of events, documents, or actions in the order of their occurrence in time.