Which of the Following Investments Has a Higher Present Value

question 23

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:

Bildungsroman

A genre of novel that focuses on the psychological and moral growth of its main character from youth to adulthood, emphasizing character development and self-discovery.

Nihilism

A philosophical doctrine that suggests the lack of belief in one or more reputedly meaningful aspects of life.

Camus

Albert Camus, a 20th-century French philosopher and author known for his existential and absurdist themes, notably in works like "The Stranger" and "The Myth of Sisyphus."

Suicide

The act of intentionally causing one's own death, often driven by factors such as psychological, social, and cultural issues; it is subject to complex ethical, moral, and philosophical debates.