What is the present value of a payment of $250 one year from today if the interest rate is 4 percent?
A)$240.38
B)$242.24
C)$244.40
D)None of the above are correct to the nearest penny.

Question

Quizplus · Accepted Answer

The present value (PV) can be calculated using the formula PV = FV / (1 + r)^n, where FV is the future value, r is the interest rate, and n is the number of periods. Plugging in the given values, we get PV = 250 / (1 + 0.04)^1 = $240.38. Therefore, the correct answer is A.

What Is the Present Value of a Payment of $250