You are promised $450 one year from now. Assumingprevailing interest rates are at 4%, what is that promiseworth today?a. $430.00b. $432.69C. $96.15d. $450.00

In this case:Future Value = $450Interest Rate = 4% = 0.04Number of periods = 1 yearPlugging in the…

Answered: You are promised $450 one year from…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Use the following 10% present value factors: N 1: 0.9091 N = 2: 0.8264 N= 3: 0.7513 Assume you wish to receive $1,000 at the end of two years. Assuming an interest rate of 10% what amount would you need to deposit todayin order to receive the S1, 000? Round to the nearest penny if necessary.
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You are promised $450 one year from now. Assuming prevailing interest rates are at 4%, what is that promise worth today? a. $430.00 b. $432.69 C. $96.15 d. $450.00