Given Some Amount to Be Received Several Years in the Future,if

question 123

Multiple Choice

Given some amount to be received several years in the future,if the interest rate increases,the present value of the future amount will

• A) Be higher.
• B) Be lower.
• C) Stay the same.
• D) Cannot tell.
• E) Be variable.

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Definitions:

Consumption

The process or activity of using goods and services to satisfy wants or needs.

Cream

The fatty part of milk, gathered at the top, used in cooking or as a spread.

Strawberries

A sweet, soft, red fruit with a seed-studded surface, commonly consumed fresh, in preserves, or as part of various dishes and desserts.

Interest Rate

The percentage of an amount of money which is charged for its use per some period of time, often annually.