Multiple Choice
Suppose that the interest rate is 7 percent.Consider four payment options: Option A: $500 today.
Option B: $550 one year from today.
Option C: $575 two years from today.
Option D: $600 three years from today.
Which of the payments has the highest present value today?
A) Option A
B) Option B
C) Option C
D) Option D
Correct Answer:
Verified
Correct Answer:
Verified
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