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A lender is promised a $200 payment (including interest) one year from today. If the lender has a 10% opportunity cost of money, he should be willing to accept what amount today? A. $200.00 B. $220.00 C. $181.82 D. $190.00

A lender is promised a $200 payment (including interest) one year from today. If the lender has a 10% opportunity cost of money, he should be willing to accept what amount today? A. $200.00 B. $220.00 C. $181.82 D. $190.00

Corporate Fin Focused Approach
Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter4: Time Value Of Money
Section4.17: Amortized Loans
Problem 1ST
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A lender is promised a $200 payment (including interest) one year from today. If the lender has a 10% opportunity cost of money, he should be willing to accept what amount today? A. $200.00 B. $220.00 C. $181.82 D. $190.00
Transcribed Image Text:A lender is promised a $200 payment (including interest) one year from today. If the lender has a 10% opportunity cost of money, he should be willing to accept what amount today? A. $200.00 B. $220.00 C. $181.82 D. $190.00
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