The present value of $100 to be received one year from now,with an annual interest rate of 8%,is

Question

Quizplus · Accepted Answer

To calculate the present value, we use the formula:

Present value = Future value / (1 + interest rate)^n

where n is the number of years.

In this case, we have:

Present value = 100 / (1 + 0.08)^1
Present value = 100 / 1.08
Present value = 92.59 (rounded to the nearest cent)

Therefore, the correct answer is B) $92.59.

The Present Value of $100 to Be Received One Year