If the Three-Year Present Value Annuity Factor Is 2

question 82

Multiple Choice

If the three-year present value annuity factor is 2.673 and the two-year present value annuity factor is 1.833, what is the present value of $1 received at the end of the three years?

• A)$1.19
• B)$0.84
• C)$0.89
• D)$0.92

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Definitions:

Loan Default

Occurs when a borrower fails to pay back a debt according to the initial agreement.

Financial Ratios

Metrics derived from financial statement analysis used by investors and analysts to evaluate a company's financial health and performance.

Bankruptcy

A legal proceeding involving a person or business that is unable to repay outstanding debts, leading to the liquidation or reorganization of assets under the law.

Operating Cash Flows

This represents the cash generated from a company's normal business operations, highlighting the company's ability to generate sufficient revenue to maintain and grow its operations.