Present Value Is Based on the Concept Of

question 32

Multiple Choice

Present value is based on the concept of:

• A) compounding.
• B) systematic risk.
• C) duration.
• D) discounting.

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Definitions:

Total Assets

The sum of all current and non-current assets owned by a company, indicated on the balance sheet, representing the total resources available to a company.

Equity Multiplier

A financial leverage ratio that measures the portion of a company's assets that are financed by shareholder equity.

ROA

Return on Assets, a financial ratio indicating how profitable a company is relative to its total assets, measuring how efficiently those assets are used to generate profit.