Uncle Roscoe,a wealthy relative,has given you a choice of receiving $10,000 today or $3,000 at the end of each year for the next four years.Which table factor(s)should be used to most efficiently determine the "value" of the $3,000 cash-flow stream?
A)Future value of $1.
B)Future value of a $1 annuity.
C)Present value of $1.
D)Present value of a $1 annuity.
E)Both "C" and "D."

Question

Quizplus · Accepted Answer

The present value of a $1 annuity table should be used to most efficiently determine the value of the $3,000 cash-flow stream. This table calculates the present value of a series of equal payments received at the end of each year. In this scenario, we need to calculate the present value of a stream of $3,000 payments for four years.

Uncle Roscoe,a Wealthy Relative,has Given You a Choice of Receiving