Suppose the Interest Rate Is 7 Percent

Multiple Choice

Suppose 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 lowest present value today?

A) Option A
B) Option B
C) Option C
D) Option D