Question: Answer all three if you can, thanks! 6. Using a lower discount rate will cause the present value of a future amount to a) increase
Answer all three if you can, thanks!
6. Using a lower discount rate will cause the present value of a future amount to
a) increase
b) decrease
c) remain constant
d) increase for short time periods but decrease for time periods of over 10 years
7. When computing the after-tax net present value of an investment
a) cash flows need to be adjusted for increased or decreased income taxes
b) the discount rate should be reduced by the marginal tax rate
c) neither of these adjustments needs to be made
d) both cash flows and the discount rate need to be adjusted
8. The future value of $10,000 placed in a savings account will depend on
a) the interest rate
b) the time it is left in the account
c) both the interest rate and time it is left in the account
d) the discount rate
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