Present value of $121,000 expected to be received one year from today at an interest rate
(discount rate) of 10% per year is:
A) $121,000
B) $100,000
C) $110,000
D) None of the above

Question

Quizplus · Accepted Answer

The present value can be calculated using the formula: PV = FV / (1 + r)^n, where PV is the present value, FV is the future value, r is the interest rate, and n is the number of periods. Plugging in the values, we get: PV = 121,000 / (1 + 0.1)^1 = $110,000. Therefore, the best choice is C.

Present Value of $121,000 Expected to Be Received One Year