You Have Been Promised a Payment of $400 in the Future.In

question 202

Multiple Choice

You have been promised a payment of $400 in the future.In which of the following cases is the present value of this payment the lowest?

• A)You receive the payment 4 years from now and the interest rate is 4 percent.
• B)You receive the payment 4 years from now and the interest rate is 5 percent.
• C)You receive the payment 5 years from now and the interest rate is 4 percent.
• D)You receive the payment 5 years from now and the interest rate is 5 percent.

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Definitions:

Personal Examples

Specific instances or experiences from an individual's life used to illustrate or explain a concept or phenomenon.

Insulin

A hormone produced by the pancreas that regulates the amount of glucose in the blood.

Glucagon

Hormone that is secreted by the pancreas to control the levels of fats, proteins, and carbohydrates in the body by increasing the level of glucose in the bloodstream.

Hunger

The physiological sensation that motivates the consumption of food.