Which of the Following Changes Would Decrease the Present Value

question 16

Multiple Choice

Which of the following changes would decrease the present value of a future payment?

• A)a decrease in the size of the payment
• B)an increase in the time until the payment is made
• C)an increase in the interest rate
• D)All of the above are correct.

---

Definitions:

Economic Activity

The processes that include creating, sharing, and using products and services in an economic system.

Automatic Stabilizers

Financial strategies and initiatives that adapt on their own to mitigate economic variances without requiring direct action from the government.

Discretionary Fiscal Measures

Discretionary fiscal measures are deliberate actions by the government to adjust its spending and taxation rates to influence the nation's economy, akin to discretionary fiscal policy with a focus on specific measures.

Budget Deficits

A financial situation where a government's expenditures exceed its revenues over a specified period, leading to borrowing or drawing down reserves.