What Is the Present Value of a Payment of $100

question 445

Multiple Choice

What is the present value of a payment of $100 to be made one year from today?

• A) $100*(1 + r)
• B) $100/(1 + r)
• C) $100 - $100 r
• D) $100 - (1 + r)/$100

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Definitions:

Hobbes

An English philosopher, best known for his political philosophy that includes the social contract theory found in his work "Leviathan."

Pristine State

Refers to the original, unaltered condition of something, often implying purity or untouched quality.

Ultimate Attribution Error

A cognitive bias where people attribute the positive behaviors of their in-group to stable, internal characteristics and negative behaviors of out-groups to their inherent qualities.

Internal Dispositions

Traits, motivations, and personality characteristics believed to reside within an individual and influence behavior.