Bank of America Interview Question: If someone offered you $1000 ... | Glassdoor

Interview Question

Investment Banking Summer Analyst Interview(Student Candidate) Chicago, IL

If someone offered you $1000 today or paid out at $100 a

  month over the next ten months, which would you take?
Answer

Interview Answer

4 Answers

4

The quantitative way to answer this is the perpetuity growth formula. You would take the monthly payments. Don't really know why, that is what the interviewer told me.

Interview Candidate on Feb 7, 2014
27

The answer should be the $1000...$1000 today is worth more than $1000 ten months from now or $100 every month for 10 months due to the time value of money.

Anonymous on Feb 11, 2014
0

Money loses value over time...

Anonymous on Sep 9, 2015
0

I think it depends largely on the market. 1000 dollars a couple years ago if put into the right fund would be nice now. With how long the market has been expanding It would be a tough choice now.

Additionally, they might be checking personality on this. Do you want your money now, or do you like something steady even if the value depreciates over time?

Anonymous on Mar 12, 2019

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