What Is the Present Value of a Stream of Annual

question 98

Multiple Choice

What is the present value of a stream of annual end-of-the-year annuity cash flows if the discount rate is 0%,and the cash flows of $50 last for 20 years?

• A)Less than $1,000
• B)Exactly $1,000
• C)More than $1,000
• D)This question cannot be answered because we have an interest rate of 0.0%.

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Definitions:

Diary Keeping

The practice of regularly recording one's experiences, thoughts, and feelings in a diary as a method of reflection, therapy, or memory preservation.

Client-Centred Therapy

A humanistic psychotherapy method developed by Carl Rogers where the therapist provides a supportive environment and emphasizes the client's capacity for self-direction.

Clarification

The process of making a statement or situation less confused and more clearly comprehensible.

Conditioned Response

A response that is learned when a neutral stimulus is regularly presented together with a stimulus that naturally triggers a reaction, transforming the neutral stimulus into a conditioned one.