As the Discount Rate Increases Without Limit, the Present Value

question 64

Multiple Choice

As the discount rate increases without limit, the present value of the future cash inflows

• A)Gets larger without limit.
• B)Stays unchanged.
• C)Approaches zero.
• D)Gets smaller without limit, i.e., approaches minus infinity.
• E)Goes to ern.

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Definitions:

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The refraction of light that occurs when its speed changes as it passes from one medium to another, causing the light to change direction.

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Rapid and temporary electrical impulses that travel across the membrane of nerve cells, facilitating neuronal communication.

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The junction between two neurons or between a neuron and muscle fiber, where electrical or chemical signals are transmitted.