4. Present value Finding a present value is the reverse of finding a future value. Which of the following is true about finding the present value of cash flows? -Finding the present value of cash...



4. Present value






Finding a present value is the reverse of finding a future value.





Which of the following is true about finding the present value of cash flows?




-Finding the present value of cash flows tells you what a cash flow will be worth in future years at a specified rate of return.






-Finding the present value of cash flows tells you how much you need to invest today so that it grows to a given future amount at a specified rate of return.












Which of the following investments that pay will $18,000 in 4 years will have a lower price today?




-The security earns an interest rate of 4.00%.






-The security earns an interest rate of 6.00%.











Jun 04, 2022
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