You Win a Prize at Your Sorority and You Are

Multiple Choice

You win a prize at your sorority and you are given the following two payoff options: Option 1 is to receive $100 one year from today and $100 two years from today. Option 2 is to receive $180 today. If the annual interest rate is 5%, the present value of option 1 is:

A) $176.56.
B) $185.94.
C) $190.48.
D) $195.24.