00:01
Okay, we're asked, is it better to receive 1 ,000 today or 3 ,000, or no, sorry, 1 ,300 in 4 years, at a rate of 0 .08 and 0 .03.
00:25
So starting at 0 .08 rate, our present value is equal to 1 ,300, e2, 0 .08 times our years, which is 4 and this gives us around $943 .99.
00:47
This is less than 1 ,000.
00:49
So at a rate of 0 .08, it's better to just accept $1 ,000 today.
00:58
This is what we want...