Suppose you have the option of receiving $1,000 today or $3,000 in 5 years. What factors would you consider before making this decision?

Now, suppose you are willing to lend $1,000 to a friend. Would you be more likely to charge him an interest rate if he agrees to pay you back in one month or if he agrees to pay you back in two years? Please explain your reasoning.

Answer rating: 100% (QA)

Its always better to receive 1000today as 3000 after 5 years will have lower net present v... View the full answer