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blackboard.com/webapps/assessment/take/launchjsp?course t PresNet, Prestyteriar & Presbyterian Healthc assessment id 116334 1&course; id-61080 18content id 1763630 PesNet provide you with two options. You could either receive $2 0,000 today or $30,000 Assume your parents want to give you a monetary gift for after you finish college and n four years. Which option would you choose if the interest rate is 8 percent? Why? TTIT Paragraph Arial Words0 QUESTION 7 sume that you have an investment that grew from $2,000 to $6,000 in five years. What was your annual rate of retum T IE Pasgaph Arta '-.-. ?.,.. Paragraph , Arial ' 3(12pt) oginal phone lists, blank forms Words 0

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Ans1 FV =

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Ans1 FV =

Future Value PV = Present Value r = rate of interest n= no of period FV = PV (1 + r )n 30000 = PV*(1 + 8%)^4 PV = 30000 / (1.08^4) PV = $ 22050.90 In first option we get $ 20000 at present In second option , present value is $ 22050.90 Second option gives more present value of money than first option. So, second option is better

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