How Are Present Values Affected by Changes in Interest Rates

question 91

Multiple Choice

How are present values affected by changes in interest rates?

• A) The lower the interest rate, the larger the present value will be.
• B) The higher the interest rate, the larger the present value will be.
• C) Present values are not affected by changes in interest rates.
• D) One would need to know the future value in order to determine the impact.

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