Present Value: John Hsu Wants to Start a Business in 10

question 29

Multiple Choice

Present value: John Hsu wants to start a business in 10 years. He hopes to have $100,000 at that time to invest in the business. To reach his goal, he plans to invest a certain amount today in a bank term deposit that will pay him 9.50 percent annually. How much will he have to invest today to achieve his target? (Round to the nearest dollar.)

• A) $54,233
• B) $63,837
• C) $91,324
• D) $40,351

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Definitions:

Lease Termination

The act of ending a lease agreement before its specified closing date, by either the landlord or tenant, under terms specified in the agreement.

Wet Floor

A surface where liquids have been spilled or cleaned, representing a slip hazard and commonly marked by warning signs to prevent accidents.

Lease Termination

The process or act of ending a lease agreement before its agreed-upon expiration date, either through mutual agreement, breaching the contract, or statutory provisions.

Joint Tenancy

A form of property ownership where two or more individuals hold equal rights over the entire property, and upon the death of one, the surviving tenant(s) receive the deceased's share by right of survivorship.