A scholarship gives you $1,000 today and promises to pay you $1,000 one year from today.What is the present value of these payments? A)$2,000/(1 + r)². B)$1,000 + $1,000/(1 + r) C)$1,000/(1 + r)+ $1,000/(1 + r)² D)$1,000(1 + r)+ $1,000(1 + r)²

Question

Quizplus · Accepted Answer

The present value of the $1,000 received today is $1,000, and the present value of the $1,000 received one year from today is $1,000/(1 + r).

A Scholarship Gives You $1,000 Today and Promises to Pay