Reference no: EM132652259
Question 1: Would you pay $6,000 today to get $900 in each of the next in 10 years if your opportunity cost of capital is 7%?
Option 1: Yes, because $6,000 today is less than $12,435 in 10 years
Option 2: Yes, because $6,000 today is less than $9,000 today
Option 3: Yes, because $6,000 today is less than $6,321 today
Option 4: No, because $6,000 today less than $12,435 in 10 years
Question 2: How much would you pay someone today to be able to receive $100,000 in eight years? Your opportunity cost of capital is 7%.
Option 1: $58,201
Option 2: $597,130
Option 3: $171,819
Option 4: $58,349