Using Progressively Higher Discount Rates

question 21

Multiple Choice

Using progressively higher discount rates

• A) tends to penalize late flows more than early flows.
• B) tends to penalize early flows more than late flows.
• C) tends to lower net present value.
• D) two of the other answers are correct

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Definitions:

Salesperson's Oral Promise

A verbal commitment made by a salesperson regarding the quality, function, or warranty of a product or service.

Implied Warranty Of Fitness

An assurance that a product will meet the buyer's specified needs, even though these assurances are not explicitly stated.

Express Warranty

A promise clearly stated by a seller about the condition, functionality, or reliability of a product.

Merchantability

A guarantee that a product will meet reasonable consumer expectations of quality and suitability for use as sold.