What Rate of Return Results in a Present Value of $23

question 2

Multiple Choice

What rate of return results in a present value of $23 for $25 received one year from now?

• A)7.8%
• B)8.1%
• C)8.4%
• D)8.7%

---

Definitions:

General Partner

An owner of a partnership who has unlimited personal liability for the debts and obligations of the business and can participate in its management.

Certificate of Limited Partnership

A legal document filed with a governmental body to form a limited partnership.

Oral Agreement

A contract that has been agreed to by speaking rather than in writing. Although legally binding, they are often harder to prove in court.

Winding Down

The process of gradually reducing operations or activities in a business, often in preparation for its closure.