Riley Says That the Present Value of $700 to Be

Multiple Choice

Riley says that the present value of $700 to be received one year from today if the interest rate is 6 percent is less than the present value of $700 to be received two years from today if the interest rate is 3 percent. Anh says that $700 saved for one year at 6 percent interest has a smaller future value than $700 saved for two years at 3 percent interest.

A) Both Riley and Anh are correct.
B) Both Riley and Anh are incorrect.
C) Only Riley is correct.
D) Only Anh is correct.