With an interest rate of 8 percent,the present value of $100 received one year from now is approximately
A) $93.
B) $96.
C) $100.
D) $108.

Question

Quizplus · Accepted Answer

The present value (PV) is calculated using the formula PV = FV / (1 + r)^n, where FV is the future value ($100), r is the interest rate (0.08), and n is the number of periods (1 year). Plugging in the values gives PV = $100 / (1 + 0.08)^1 = $100 / 1.08 = approximately $92.59, which is closest to $93.

With an Interest Rate of 8 Percent,the Present Value of $100