The discount rate is:
A)The rate at which we bring future values back to the present.
B)Obtained by taking the rate of return offered in the market for a comparable investment.
C)Sometimes called the present value interest factor.
D)Inversely related to the present value.
E)All of the above.

Question

Quizplus · Accepted Answer

All of the given options are correct. The discount rate is the rate used to bring future values back to the present, it is obtained by taking the market return for a comparable investment, and it is also called the present value interest factor. Additionally, the discount rate and present value are inversely related; as the discount rate increases, the present value decreases.

The Discount Rate Is