Seth's grandmother gave him a $50 savings bond for his birthday.The bond pays $50 at maturity, which is in five years.If the interest rate is 5%, the bond has a present value of $43.19.

Question

Quizplus · Accepted Answer

The present value of a $50 savings bond with a 5% interest rate and maturity in 5 years is not $43.19. Using the present value formula, the present value of the bond is $38.55. Therefore, the statement is false.

Seth's Grandmother Gave Him a $50 Savings Bond for His