Answer:
C. $510 in one year
Explanation:
Present Value of of a sum receivable after n years compounded at r% rate of interest is given by
PV = [tex]\frac{FV}{(1\ +\ R)^{n} }[/tex]
where PV= Present Value as on today
FV = Future Value of amount receivable
R= Rate of interest per annum
n= Time period
Hence, PV of $510 receivable one year hence would be
= [tex]\frac{510}{(1\ +\ .02)^{1} }[/tex]
= $500 today
