Select the statement that correctly explains the relationship between interest rates and present or future value. Assuming
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Question:
Select the statement that correctly explains the relationship between interest rates and present or future value.
- Assuming other variables stay the same, if the interest rate decreases, the future value of an investment increases.
- Assuming other variables stay the same, if the interest rate increases, the present value of an investment increases.
- Assuming other variables stay the same, if the interest rate decreases, the present value of an investment decreases.
- The interest rate and the present value of an investment are inversely related.
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