How would we compute the present discounted value of payments of $8,000 received thre years in the future and $10,000 received four years in the future? The interest rate is expec to be 5 percent for the next four years. Please choose one: O a. 8,000/((15)3) + 10,000/(1.5)4) O b.8,000/(1.05)3) + 10,000/(1.05)4) O c 8,000/(103) + 10,000/(104) D 8,000/(105)+10,000/((1.05)2)
How would we compute the present discounted value of payments of $8,000 received thre years in the future and $10,000 received four years in the future? The interest rate is expec to be 5 percent for the next four years. Please choose one: O a. 8,000/((15)3) + 10,000/(1.5)4) O b.8,000/(1.05)3) + 10,000/(1.05)4) O c 8,000/(103) + 10,000/(104) D 8,000/(105)+10,000/((1.05)2)
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:How would we compute the present discounted value of payments of $8,000 received three
years in the future and $10,000 received four years in the future? The interest rate is expected
to be 5 percent for the next four years.
Please choose one:
O a. 8,000/((15)3) + 10,000/(1.5)4)
O b.8,000/((1.05)3) +10,000/((1.05)4)
Oc 8,000/(1.03) + 10,000/(104)
O D 8,000/(105) +10,000/((1.05)2)
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