You have been told that you need $21,600 today in order to have $100,000 when you retire 42 years from now. What rate of interest was used in the present value computation? Assume interest is compounded annually.
A) 3.72 percent
B) 3.89 percent
C) 4.01 percent
D) 4.23 percent
E) 4.28 percent

Question

Quizplus · Accepted Answer

The correct answer is A because the present value of $100,000 to be received 42 years from now at an interest rate of 3.72 percent is $21,600.

You Have Been Told That You Need $21,600 Today in Order