If the Five-Year Discount Factor Is D,what Is the Present

question 25

Multiple Choice

If the five-year discount factor is d,what is the present value of $1 received in five years' time?

• A) 1/(1 + d)⁵
• B) 1/d.
• C) 5d.
• D) d.

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Definitions:

FOB Shipping Point

A shipping term indicating that the buyer assumes responsibility for the goods and transportation costs as soon as the goods leave the seller's premises.

Consignment

A business arrangement where goods are left in the possession of an authorized third party to sell, typically for a share of the revenue from the sale.

Financial Statements

Financial statements are formal records of the financial activities and position of a business, person, or other entity, typically comprising the balance sheet, income statement, and cash flow statement.

FIFO

"First In, First Out," an inventory valuation method where goods first received are the first ones sold.