Finding a present value is the reverse of finding a future value. is the process of calculating the present value of a cash flow or a series of cash flows to be Compounding ure. Discounting Which of the following investments that pay will $5,000 in 12 years will have a lower price today? Assume that both investments have equal risk. The security that earns an interest rate of 15.00%. The security that earns an interest rate of 10.00%. Eric wants to invest in government securities that promise to pay $1,000 at maturity. The opportunity cost (interest rate) of holding the security is 9.60%. Assuming that both investments have equal risk and Eric's investment time horizon is flexible, which of the following investment options will exhibit the lower price? O An investment that matures in three years O An investment that matures in four years Which of the following is true about present value calculations? O other things remaining equal, the present value of a future cash flow increases if the investment time period increases O Other things remaining equal, the present value of a future cash flow decreases if the investment time period increases