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(Related to Checkpoint 5.4) (Present-value comparison) You are offered $110,000 today or $300,000 in 11 years. Assuming that you can earn 11 percent on your money, which should you choose? If you are offered $300,000 in 11 years and you can earn 11 percent on your money, what is the present value of $300,000? $ (Round to the nearest cent.) Which offer should you choose? (Select the best choice below.) OA. Choose $300,000 in 11 years because its present value is higher. OB. Choose $110,000 today because its present value is higher.

(Related to Checkpoint 5.4) (Present-value comparison) You are offered $110,000 today or $300,000 in 11 years. Assuming that you can earn 11 percent on your money, which should you choose? If you are offered $300,000 in 11 years and you can earn 11 percent on your money, what is the present value of $300,000? $ (Round to the nearest cent.) Which offer should you choose? (Select the best choice below.) OA. Choose $300,000 in 11 years because its present value is higher. OB. Choose $110,000 today because its present value is higher.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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(Related to Checkpoint 5.4) (Present-value comparison) You are offered $110,000 today or $300,000 in 11 years. Assuming that you can earn 11 percent on your money, which should you choose? If you are offered $300,000 in 11 years and you can earn 11 percent on your money, what is the present value of $300,000? $ (Round to the nearest cent.) Which offer should you choose? (Select the best choice below.) OA. Choose $300,000 in 11 years because its present value is higher. OB. Choose $110,000 today because its present value is higher.
Transcribed Image Text:(Related to Checkpoint 5.4) (Present-value comparison) You are offered $110,000 today or $300,000 in 11 years. Assuming that you can earn 11 percent on your money, which should you choose? If you are offered $300,000 in 11 years and you can earn 11 percent on your money, what is the present value of $300,000? $ (Round to the nearest cent.) Which offer should you choose? (Select the best choice below.) OA. Choose $300,000 in 11 years because its present value is higher. OB. Choose $110,000 today because its present value is higher.
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