The Amount Received Today That Would Be Equivalent in Value

question 47

Multiple Choice

The amount received today that would be equivalent in value to a future payment or series of payments represents the:

• A) present value.
• B) discounted value.
• C) equivalent value.
• D) future value.
• E) net present value.

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Definitions:

Pretax Income

The income of a company before tax is deducted.

Contribution Margin Ratio

A financial metric that measures how a product's selling price covers variable costs, expressed as a percentage of sales revenue.

Unit Contribution Margin

Unit contribution margin is the difference between the selling price of a product and its variable costs, indicating how much each unit sold contributes to covering fixed expenses and generating profit.

Sales

The total revenue generated from goods or services sold by a company over a specified period.