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You Are Scheduled to Receive $10,000 in One Year

Question 9

Multiple Choice

You are scheduled to receive $10,000 in one year. An increase in the interest rate will have what effect on the present value of this cash flow?


A) It will cause the present value to rise.
B) It will have no effect on the present value.
C) It will cause the present value to fall.
D) The effect cannot be determined with the information provided.

Correct Answer:

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