Present value\ 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 received in the future.\ Which of the following investments that pay will

$19,000

in 14 years will have a higher price today?\ The security that earns an interest rate of

10.50%

.\ The security that earns an interest rate of

7.00%

.\ 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?\ An investment that matures in six years\ An investment that matures in five years

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 received in the future. Which of the following investments that pay will $19,000 in 14 years will have a higher price today? The security that earns an interest rate of 10.50%. The security that earns an interest rate of 7.00%. 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 wil exhibit the lower price? An investment that matures in six years An investment that matures in five years