You Receive $500 Today Which You Plan to Save for Two

question 193

Multiple Choice

You receive $500 today which you plan to save for two years.Also,in two years you will be given another $500.If the interest rate is 5 percent,what is the present value of the payment of $500 today and the $500 in two years?

• A)$500(1.05)² + $500/(1.05)²
• B)$500(1.05)² + $500
• C)$500 + $500/(1.05)²
• D)$500 + $500

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Definitions:

Santa Costanza

An ancient church in Rome, Italy, notable for its central plan and early Christian art, dating back to the 4th century.

Roman Funerary Art

Art forms from ancient Rome designed to commemorate the deceased, including sculptures, monuments, and tomb paintings.

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A body of myths belonging to the ancient Greeks, concerning their gods and heroes, the nature of the world, and the origins and significance of their own cult and ritual practices.

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