The ____ Is the Current Interest Rate Appropriate for Discounting

question 39

Multiple Choice

The ____ is the current interest rate appropriate for discounting a cash flow of some given maturity.

• A) spot rate
• B) forward rate
• C) future spot rate
• D) futures rate

---

Definitions:

Period Costs

Expenses that are not directly tied to production and are expensed in the period they are incurred, such as selling and administrative expenses.

Units Sold

The total number of units of product sold by a company during a reporting period.

Selling Price

The amount of money a customer pays to purchase a product or service.

Contribution Margin

The amount by which sales revenue exceeds variable costs, used to cover fixed expenses and contribute to profit.