To Compute the Future Value of a Cash Flow, You

question 99

Multiple Choice

To compute the future value of a cash flow, you must ________.

• A) discount it
• B) compound it
• C) double it
• D) arbitrage it

---

Definitions:

Inherited Property

Property that individuals receive as a result of the death of the previous owner, transferring ownership through a will or by law.

Depreciation Basis

The initial cost of an asset that is used to calculate depreciation expense over the asset's useful life.

Decedent's Basis

The value assigned to a deceased person's property for tax purposes, determining the basis for heirs or beneficiaries for capital gains tax calculations when they sell the property.

Ordinary Expense

Regular and necessary costs incurred in running a business that are tax-deductible.