You win a prize and can take Rs. 1,000 today or Rs. 1,050 in one year. If you can earn 5 per cent on your money, which do you prefer and why?
Correct answer B. Either, because both options are of equal value
Explanation
Investing Rs. 1,000 at 5 per cent for a year gives exactly Rs. 1,050, so the present value of both options is identical.
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