Digital Means Fingers and Toes

question 62

True/False

Digital means fingers and toes.

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Definitions:

Reinvestment Assumption

The presumption that cash flows received from an investment will be reinvested at a rate consistent with the investment's original rate of return.

Net Present Value

A financial metric that calculates the present value of all future cash flows associated with an investment, minus the initial investment cost.

Present Value

The current worth of a future sum of money or stream of cash flows given a specified rate of return.

Unequal Lives

A term used in capital budgeting to describe projects or investments with different durations.