The Present Value of $200 to Be Paid to You

question 46

Multiple Choice

The present value of $200 to be paid to you at the end of two years, if the market interest rate is 5 percent, is

• A)$181.41
• B)$190.00
• C)$210.00
• D)$225.78
• E)cannot be determined from the information given

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Definitions:

Utilities Expense

Costs incurred by a business for essential services such as water, electricity, and gas.

General Journal

A comprehensive journal that records all the day-to-day financial transactions of a company, including debits and credits.

Common Stock

A type of equity security that represents ownership in a corporation, with rights to share in its profits and vote in major decisions.

Cash

Liquid currency and resources such as bank deposits that a business has immediate access to for transactions and operations.