This topic contains a solution. Click here to go to the answer
« previous next »

Author Question: What is the formula for the present value of 1 one year from now? If the rate of interest is 5 ... (Read 91 times)

krzymel

  • Hero Member
  • *****
  • Posts: 548
on: Jun 29, 2018
What is the formula for the present value of 1 one year from now? If the rate of interest is 5 percent, what is the present value of 10 to be paid one year from now?
 
  What will be an ideal response?

Question 2

The sale of Treasury securities by the Federal Reserve will, in general,
 
  A) decrease the quantity of reserves held by banks.
  B) not change the money supply.
  C) not change the quantity of reserves held by banks.
  D) increase the quantity of reserves held by banks.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

asdfasdf

  • Sr. Member
  • ****
  • Posts: 339
Reply #1 on: Jun 29, 2018
Answer to Question 1

The formula for the present value of 1 one year from now is 1/(1 + r) where r is the market rate of interest. If the interest rate is 5 percent, the present value of 10 to be paid one year from now is 9.52 .

Answer to Question 2

A


krzymel

  • Hero Member
  • *****
  • Posts: 548
Reply #2 on: Jun 29, 2018
Correct answers!


asdfasdf

  • Sr. Member
  • ****
  • Posts: 339
Reply #3 on: Jun 29, 2018
Great! Please up vote :D


« previous next »
 

Did you know?

There are over 65,000 known species of protozoa. About 10,000 species are parasitic.

Did you know?

Signs of depression include feeling sad most of the time for 2 weeks or longer; loss of interest in things normally enjoyed; lack of energy; sleep and appetite disturbances; weight changes; feelings of hopelessness, helplessness, or worthlessness; an inability to make decisions; and thoughts of death and suicide.

Did you know?

Asthma is the most common chronic childhood disease in the world. Most children who develop asthma have symptoms before they are 5 years old.

Did you know?

The people with the highest levels of LDL are Mexican American males and non-Hispanic black females.

Did you know?

Nearly 31 million adults in America have a total cholesterol level that is more than 240 mg per dL.

The skeleton of a dwarf elephant from the island of Crete. Dwarf elephants were present on some Medi The skeleton of a dwarf elephant from the island of Crete. Dwarf elephants were present on some Medi
On March 25, 1911, as scores of young factory girls leaped to their deaths from the eighth, ninth, a On March 25, 1911, as scores of young factory girls leaped to their deaths from the eighth, ninth, a
Effect of Increasing the Investment Rate on the Steady State Effect of Increasing the Investment Rate on the Steady State
Estimated number of new HIV infections per year over time period in Canada Estimated number of new HIV infections per year over time period in Canada
Provide the given and then write the formula and solve Provide the given and then write the formula and solve
Sonja is paid $42.50 per hour as a veterinarian. She is paid 1 times the regular rate for all ... Sonja is paid $42.50 per hour as a veterinarian. She is paid 1 times the regular rate for all ...
Video: Steps of glucose catabolism

For a complete list of videos, visit our video library