What is the present value of a payment of $100 one year from today if the interest rate is 5 percent?
A)$95.50
B)$95.24
C)$95.00
D)None of the above are correct to the nearest penny.

Name: What is the present value of a payment of $100 one year from today if the interest rate is 5 percent? A)$95.50 B)$95.24 C)$95.00 D)None of the above are correct to the nearest penny.
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Question

Quizplus · Accepted Answer

Using the present value formula: PV = FV / (1 + r)^n 
PV = 100 / (1 + 0.05)^1 = $95.24

What Is the Present Value of a Payment of $100