The Present Value Interest Factor Is

question 78

Multiple Choice

The present value interest factor is

• A)always less than 1.0.
• B)always more than 1.0.
• C)assumes simple interest.
• D)always between 1.0 to 2.0.

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Definitions:

Annual Payment

A payment made once a year, often in the context of loans, leases, or insurance policies.

Investment

The allocation of resources, usually money, in order to generate income or profit.

Present Value

The calculated value in current terms of an expected future cash flow or sum of money, discounting at a given rate of return.

Annual Interest Rate

The yearly rate charged by a lender to a borrower, expressed as a percentage of the principal loan amount.