When Calculating Present Value, as T Becomes Larger and Because

question 13

Multiple Choice

When calculating present value, as t becomes larger and because r≥0, a_t / (1 + r) ᵗ goes to

• A) zero
• B) positive infinity
• C) negative infinity

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Definitions:

Random Variable

A variable whose values depend on outcomes of a random phenomenon, with each outcome having a certain probability.

Confidence Interval

A breadth of values, derived from sample observations, with a high chance of containing an unknown population parameter's value.

Level Of Significance

The probability of rejecting the null hypothesis in a statistical test when it is actually true, often denoted by alpha.

Null Hypothesis

A statistical hypothesis that suggests there is no significant effect or difference between certain data sets or variables.