Which of the following has a present value of $100?
A)$109.12 in two years when the interest rate is 4 percent
B)$113.98 in two years when the interest rate is 6 percent
C)$116.64 in two years when the interest rate is 8 percent
D)$123.17 in two years when the interest rate is 10 percent

Question

Quizplus · Accepted Answer

To find the present value, we need to use the formula:
Present value = Future value / (1+interest rate)^time
Using this formula for each option, we get:
A) Present value = 109.12 / (1+0.04)^2 = 100.00
B) Present value = 113.98 / (1+0.06)^2 = 100.00
C) Present value = 116.64 / (1+0.08)^2 = 100.00
D) Present value = 123.17 / (1+0.10)^2 = 100.00
Therefore, option C has a present value of $100.

Which of the Following Has a Present Value of $100