A lender is promised a $100 payment (including interest) one year from today. If the lender has an 8% opportunity cost of money, he should be willing to accept what amount today? A. $100.00 B. $108.20 C. $92.59 D. $96.40
A lender is promised a $100 payment (including interest) one year from today. If the lender has an 8% opportunity cost of money, he should be willing to accept what amount today? A. $100.00 B. $108.20 C. $92.59 D. $96.40
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
What amount today
Transcribed Image Text:A lender is promised a $100 payment (including interest) one
year from today. If the lender has an 8% opportunity cost of
money, he should be willing to accept what amount today?
A. $100.00
B. $108.20
C. $92.59
D. $96.40
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