The Future Value of Multiple Cash Flows Is

question 19

Multiple Choice

The future value of multiple cash flows is:

• A) greater than the sum of the cash flows.
• B) equal to the sum of all the cash flows.
• C) less than the sum of the cash flows.
• D) higher or lower than the cash flows depending on the interest rate.

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Definitions:

Debts Owed

Amounts of money that are required to be repaid by an individual or organization to creditors.

Drawing Account

A specific account used to record amounts withdrawn by the owner(s) of a business for personal use.

Withdrawals

Amounts taken from a business by its owner(s) for personal use.

Expenses

Costs incurred by a business in the process of earning revenue.