Asked by Avelina Milam on Jun 09, 2024
Verified
Which would you rather have? a)$100,10 years from now at 4% interest,or b)$100,4 years from now at 12% interest.
Interest Rate
The cost of borrowing money, expressed as a percentage of the total amount borrowed, paid by the borrower to the lender for the use of their money.
- Analyze investment options to choose the one with the greatest financial benefit.
- Understand the relationship between interest rates, time periods, and the future value of investments.
Verified Answer
SS
Sofia SantosJun 11, 2024
Final Answer :
a)$67.56
b)$63.55
The present value of a)is greater than the present value of b).
b)$63.55
The present value of a)is greater than the present value of b).
Learning Objectives
- Analyze investment options to choose the one with the greatest financial benefit.
- Understand the relationship between interest rates, time periods, and the future value of investments.
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