Identify the Correct Equation for Calculating the Present Value of an Investment

question 12

Multiple Choice

Identify the correct equation for calculating the present value of an investment. (Assume 'r' stands for rate of return and 'n' stands for number of periods interest is earned.)

• A)Present value = Future value × (1 + r)ⁿ
• B)Present value = Future value + (1 + r)ⁿ
• C)Present value = Future value - (1 + r)ⁿ
• D)Present value = Future value / (1 + r)ⁿ
• E)Present value = Future value / ((1 + r) × n)

---

Definitions:

Instrumental

Relating to an action or tool that is a means to achieve an end or goal.

Heterosexual

A sexual orientation characterized by an enduring pattern of emotional, romantic, or sexual attractions exclusively to persons of the opposite sex.

Cultures of Honor

Social contexts where individuals place a high value on personal status, strength, and the willingness to use aggression to defend reputation.

Marital Violence

Acts of physical aggression and violence that occur between partners within the context of marriage.