Using the Following Partial Table of Present Value of $1

question 172

Multiple Choice

Using the following partial table of present value of $1 at compound interest, determine the present value of $30,000 to be received three years hence, with earnings at the rate of 12% a year:

• A) $14,240
• B) $16,800
• C) $21,360
• D) $15,840

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Definitions:

Income Elasticity

A measure of how much the demand for a product changes in relation to a change in consumers' incomes.

Luxuries

Items or services that are considered non-essential but desirable, typically associated with high quality and a higher price.

Inelastic Demand

A situation where the quantity demanded of a good or service changes minimally in response to price changes.

Total Revenue

The total amount of money received by a company for goods sold or services provided during a certain period of time.