Which is more valuable, receiving $1,000 today or receiving $1,200 in 3 years if interest rates are 7 percent?
A) receiving $1,000 today
B) receiving $1,200 in 3 years
C) They are worth the same amount.
D) need more information to make a determination

Question

Quizplus · Accepted Answer

The value of receiving $1,000 today is more valuable due to the concept of the time value of money. At a 7% interest rate, $1,000 invested today would grow to more than $1,200 in 3 years, making the immediate $1,000 the better option.

Which Is More Valuable, Receiving $1,000 Today or Receiving $1,200