Given an interest rate of zero percent, the future value of a lump sum invested today will always:
A)remain constant, regardless of the investment time period.
B)decrease if the investment time period is shortened.
C)decrease if the investment time period is lengthened.
D)be equal to $0.
E)be infinite in value.

Question

Quizplus · Accepted Answer

With a zero percent interest rate, the future value of a lump sum remains constant over time because there is no growth or interest accumulation.

Given an Interest Rate of Zero Percent, the Future Value