The firm in the table below produces denim jeans and each unit of capital represents one sewing machine.The MRP for each of machines 10 through 14 is provided.Each sewing machine delivers a stream of MRPs beginning one year from now,for a total of 2 years.Assume that after 2 years each sewing machine is worth nothing. TABLE 15- 2
-The present value of a given future stream of benefits will be lower when the benefits are and the interest rate is .
A) equalized over a ten- year period; zero
B) more distant in time; lower
C) nearer in time; lower
D) more distant in time; higher
E) accruing in the first time period only; lower
Correct Answer:
Verified
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