Present Value Is Defined As

question 52

Multiple Choice

Present value is defined as:

• A)future cash flows discounted to the present by an appropriate discount rate.
• B)inverse of future cash flows.
• C)present cash flows compounded into the future.
• D)future cash flows multiplied by the factor (1 + r)^t.

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Definitions:

Money Market Securities

Short-term financial instruments typically with high liquidity and short maturities, used by participants as a means for borrowing and lending in the short term.

Maturity

The scheduled day when the full amount of a financial device like a bond or loan must be completely paid off.

Eliminating Float

Strategies or processes aimed at reducing the time delay between when a check is written and when it clears the banking system.

Total Float

The amount of time that a project task can be delayed without causing a delay to subsequent tasks or the project's completion date.