Which of the following is correct if the interest rate is 6 percent?
a. $215 to be received a year from today has a present value of over $200; $420 a year from now has a present value over $400.
b. $215 to be received a year from today has a present value of over $200; $420 a year from now has a present value under $400.
c. $215 to be received a year from today has a present value of under $200; $420 a year from now has a present value over $400.
d. $215 to be received a year from today has a present value of under $200; $420 a year from now has a present value under $400.
b
You might also like to view...
When regulators identify with the special interests of the industry they regulate, this behavior conforms with the
A) share-the-gains, share-the-pains hypothesis. B) rate-of-return hypothesis. C) lemon market hypothesis. D) capture hypothesis.
Which of the following is a valid concern about the national debt for a country whose debt is held entirely by its citizens?
a. The welfare of future generations will be directly related to the per-capita size of the national debt that they inherit. b. Growth of the national debt will eventually lead to the bankruptcy of the government. c. When the debt comes due, future generations may be unable to pay it off. d. If the increases in the national debt reduce private expenditures on capital formation, future generations may have lower incomes because they will inherit a smaller stock of capital.