Your grandmother has promised to give you $10,000 when you graduate from college. If you speed...

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Your grandmother has promised to give you $10,000 when you graduate from college. If you speed...

Your grandmother has promised to give you $10,000 when you graduate from college. If you speed up your graduation by one year and graduate two years from now rather than the expected three years, the present value of this gift will:

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Answer 1

Answer #1

the present value of this gift will increase

so increase is the answer

because he will be getting money one year earlier, so discounting factor will be less

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Answer 2

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