Which of the Following Investments Has a Higher Present Value

question 20

Multiple Choice

Which of the following investments has a higher present value, assuming the same (strictly positive) interest rate applies to both investments?

• A) Investment X has a higher present value.
• B) Investment Y has a higher present value.
• C) Investment X and Investment Y have the same present value, since the total of the cash flows is the same for both.
• D) No comparison can be made-we need to know the interest rate to calculate the present value.

---

Definitions:

Gluten-Free

A diet that excludes gluten, a protein found in wheat, barley, and rye, often adopted by those with celiac disease or gluten sensitivity.

Low Sodium

A dietary condition or recommendation involving reduced intake of sodium to help manage or prevent high blood pressure and other cardiovascular diseases.

Penicillin

A group of antibiotics derived from Penicillium fungi, used in the treatment of various bacterial infections.

Orthostatic Hypotension

A condition characterized by a sudden drop in blood pressure when a person stands up from a sitting or lying position, often resulting in dizziness or fainting.