The Present Value of $1,000 Received Three Years from Today

question 68

True/False

The present value of $1,000 received three years from today with a discount rate of 10% is less than the present value of a $500 annuity with the same discount rate over the same period.

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Definitions:

Buyers

Persons or organizations that buy products or services.

Sellers

Entities or individuals who make goods or services available for purchase by consumers or businesses.

Price Elastic

A measure of how much the quantity demanded of a good responds to a change in its price; high elasticity indicates a significant change in quantity with price changes.

Supply Curve

A graphical representation of the relationship between the price of a good or service and the quantity of that good or service that a supplier is willing and able to supply to the market.