When the annual interest rate is 7 percent, what is the present value of receiving a payment of $10,000 three years from now?
a. $10,700.00.
b. $10,244.89.
c. $9,300.00
d. $8,162.98.
d. $8,162.98.
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Refer to Figure 5-13. The gasoline tax raises the price paid by consumers by ________ per gallon
A) $0.75 B) $1.25 C) $1.75 D) $2.00
Suppose the price index is 100 in the base year and the price of a pound of oranges in that year is $1.96 . Now, if the price index changes to 105 in the following year, how much would a pound of oranges cost?
a. $2.45 b. $0.25 c. $1.96 d. $2.06 e. $1.50
A new computer will generate $1,000 in net revenue for a firm during its first year, $500 during its second year, $250 during its third year, and nothing thereafter. If the interest rate is 10 percent (0.10) per year, what is the present value of the computer to the firm? (The first payment will be received at the end of this year.)
a. $1,590.91 b. $1,510.14 c. $1,750.00 d. $1,446.28 e. $1,661.16
Changes in labor productivity, changes in the quality of labor, and changes in the price of labor are three factors that explain why labor costs eventually
a. increase at a decreasing rate b. increase at an increasing rate c. decrease at an increasing rate d. decrease at a decreasing rate e. become constant