Question: How are present values affected by changes in interest rates? The lower the interest rate, the larger the present value will be. Present values are

How are present values affected by changes in interest rates?

"The lower the interest rate, the larger the present value will be."

Present values are not affected by changes in interest rates.

"The higher the interest rate, the larger the present value will be."

One would need to know the future value in order to determine the answer to this question

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

how are present values affected by changes and interest rates the higher interest rate the larger the present value will be the lower the interest rate the larger of the present value will be

Q:

You may solve the following problems algebraically, or you may use a financial calculator or Excel spreadsheet. If you choose to solve the problems algebraically, be sure to show your computations....

Q:

Time Value of Money: Single Cash Flows Introduction Time value of money (TVM) is the foundation of mathematical finance. This assignment is designed to show you how the TVM concept can be applied to...

Q:

$690.82 Question 42 (Mandatory) (0.5 points) A deposit of $1,000 earns the following interest rates: 8 percent in the first year 7 percent in the second year, and 8 percent in the third year. What...

Q:

Referencias Documento1 - Microsoft Word (Error de activacin de productos) Correspondencia Revisar Vista Linea de fin 5 Formas SmartArt Grfico Captura Fecha y hor Hipervnculo Marcador Referencia...

Q:

How are future values affected by changes in interest rates? a. The lower the interest rate, the larger the future value will be. b. The higher the interest rate, the larger the future value will be....

Q:

22 & 23 & 24 pls tell the right answer ||22. Louis' tire business has total assets of $18 million of which $6 million are current assets. Cash makes up 10 percent of the current assets and accounts...

Q:

Question 1 (4 points) 1. Which of the following is not considered one of the monitors of the firm? Senior management Auditors The board of directors Stock analysts Question 2 (4 points) 2. Which of...

Q:

How are present values affected by changes in interest rates? The lower the interest rate, the larger the present value will be. One would need to know the future value in order to determine the...

Q:

How are present values affected by changes in interest rates? Multiple Choice The lower the interest rate, the larger the present value will be . The higher the interest rate, the larger the present...

Q:

Nina graduated from university in 2021 with a large tuition loan but was excited to have landed a very lucrative job with Microsoft. Despite the great salary, she was terrible at managing her money....

Q:

Heal [ 2001, p. 1] notes that when Frederick Law Olmsted, the designer of New York Citys Central Park, was asked how the city could pay for the park, he responded that its presence would raise...

Q:

What are advantages of the internal rate of return? Group of answer choices The IRR rule accounts for time value because it is finding the rate of return that equates all of the cash flows on a time...

Q:

A company is preparing completing their Cash Budget. The following data has been prepared for cash receipts and payments. January February March Cash receipts $1,061,200 $1,182,400 $1,091,700 Cash...