Someone Has Offered You the Opportunity to Purchase an IOU

Multiple Choice

Someone has offered you the opportunity to purchase an IOU.The IOU will pay back a total of $500 in three years.How much would you be willing to pay for that IOU today if you want to earn an annual rate of return of 16%?

A) $320.33
B) $422.63
C) $292.63
D) $380.45