Which,if Any,of the Present Values Below Are Computed Correctly

question 190

Multiple Choice

Which,if any,of the present values below are computed correctly?

• A)A payment of $100 to be received one year from today,with a 2 percent interest rate,has a present value of $98.81.
• B)A payment of $200 to be received two years from today,with a 3 percent interest rate,has a present value of $188.52.
• C)A payment of $300 to be received three years from today,with a 4 percent interest rate,has a present value of $234.34.
• D)None of the above are correct to the nearest cent.

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Definitions:

Right-Skewed

Refers to a distribution where the tail on the right side of the histogram is longer or fatter than the left side.

Standard Deviation

A metric that quantifies the degree of spread or scattering among values in a dataset, illustrating the extent to which these values diverge.

Mean

The average value of a set of numbers, calculated by summing them up and dividing by the count of numbers.

Normally Distributed

A type of distribution in statistical theory where data is symmetrically distributed around a mean value, resembling a bell curve.