With an interest rate of 6 percent,the present value of $100 to be received next year is approximately
A)$106.
B)$100.
C)$94.
D)$92.

Question

Quizplus · Accepted Answer

The present value formula is: PV = FV / (1+r), where PV is the present value, FV is the future value, and r is the interest rate.

Substituting the values: 
PV = 100 / (1+0.06) 
PV = 94.34

Therefore, the present value of $100 to be received next year is approximately $94. So, the best choice is C.

With an Interest Rate of 6 Percent,the Present Value of $100