Asked by
tubista amanuel
on Dec 12, 2024
Verified
The net present value of $1,000 received at a time in the future would
A) decline if the $1,000 were received sooner.
B) increase if the delivery date for the $1,000 were set farther into the future.
C) increase if the interest rate rose.
D) increase if the interest rate fell.
Net Present Value
The difference between the present value of cash inflows and the present value of cash outflows over a period of time.
Interest Rate
The proportion of a loan that is charged as interest to the borrower, typically expressed as an annual percentage of the outstanding loan.
- Acquire knowledge on the effect of fluctuating interest rates on the present value of prospective cash flows.
Verified Answer
AH
Learning Objectives
- Acquire knowledge on the effect of fluctuating interest rates on the present value of prospective cash flows.