Suppose the Nominal Interest Rate Is Zero

question 74

Multiple Choice

Suppose the nominal interest rate is zero.In this situation,the present discounted value of a finite sequence of future payments is equal to which of the following?

• A)zero
• B)the sum of the all payments divided by the rate of inflation
• C)the average value of each payment
• D)the sum of all payments
• E) the square of the sum of all payments

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Definitions:

Sphygm/o

A prefix related to the pulse, used in terms denoting something measured by the pulse.

Arterial Blood Pressure

The pressure within arteries, which is vital for circulating blood throughout the body.

Sphygmomanometer

A sphygmomanometer is a device used to measure blood pressure, typically involving a cuff that is placed around the arm.

Electrocardiograph

A medical device used to record the electrical activity of the heart over a period of time.