Example of Economic Equivalence Suppose you are offered the alternative of receiving either $2,007 at the end of five years or $1,500 today. There is no question that the $2,007 will be paid in full (i.e., there’s no risk of nonreceipt). Assuming that the money will not be needed in the next five years, you would deposit the $1,500 in an account that pays i% interest. What value of i would make you indifferent to your choice between $1,500 today and the promise of $2,007 at the end of five years? Simple vs. Compound Interest