In Which of the Following Instances Is the Present Value

question 2

Multiple Choice

In which of the following instances is the present value of the future payment the largest?

• A)You will receive $1,000 in 5 years and the annual interest rate is 5 percent.
• B)You will receive $1,000 in 10 years and the annual interest rate is 3 percent.
• C)You will receive $2,000 in 10 years and the annual interest rate is 10 percent.
• D)You will receive $2,400 in 15 years and the annual interest rate is 8 percent.

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Definitions:

Cognitive-Behavioral

A therapeutic approach that addresses dysfunctional emotions, maladaptive behaviors, and cognitive processes through goal-oriented, explicit systemic procedures.

Gestalt

A theory in psychology that emphasizes the human mind and behavior as a whole, rather than breaking it down into individual components.

Psychoanalytical

Relating to the theory and method of therapy that delves into the unconscious, exploring motivations, conflicts, and defensive mechanisms.

Psychoanalytic Theory

A theory of personality organization and the dynamics of personality development that guides psychoanalysis, developed by Sigmund Freud.