The Higher the Discount Rate, the Higher the Present Value

question 222

True/False

The higher the discount rate, the higher the present value of a given future cash flow.

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Definitions:

Unemployment Rate

The percentage of the labor force that is jobless and actively seeking employment, indicating the health of an economy.

Labor Force

The aggregate sum of individuals working or in pursuit of work within a nation or area.

Discouraged Workers

Individuals not actively seeking employment because they believe no jobs are available for them.

Frictional Unemployment

A type of unemployment that occurs when individuals are temporarily unemployed while moving between jobs, entering the workforce for the first time, or re-entering the workforce.