What Amount Received at the End of 15 Years Is

question 181

Multiple Choice

What amount received at the end of 15 years is equivalent to $100 received at the end of each year for 15 years if the interest rate is 12%?

• A)$3,728
• B)$4,042
• C)$2,676
• D)$547
• E)$625

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Definitions:

Liquidated Debt

A debt with a known, fixed amount that is not disputed by either party.

Unliquidated Debt

A debt for which the exact monetary value has not been determined.

Preexisting Duty

An obligation that a party is already legally bound to fulfill, which cannot serve as consideration for a new contract.

Accord and Satisfaction

A legal settlement where an agreement is made to discharge a claim by providing some form of compensation that differs from the original obligation.