Given an Annual Interest Rate of 2%, the Present Value

question 182

Multiple Choice

Given an annual interest rate of 2%, the present value of a future payment of $1,500 to be paid in one year is:

• A) $1,250.55.
• B) $1,470.59.
• C) $1,530.
• D) $1,500.

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Definitions:

Forever

A term indicating an infinite or unspecified period of time, often used in the context of time without end.

Average Total Cost

The cost per unit of output, calculated by dividing the total cost by the quantity of output produced.

Natural Monopoly

A market condition where a single firm can supply a good or service to an entire market at a lower cost than could two or more firms.

Natural Monopoly

A market structure where a single supplier is most efficient in providing goods or services due to high fixed or startup costs.