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The Present Value of a Payment to Be Received in the Future

Question 102

Multiple Choice

The present value of a payment to be received in the future is:


A) the maximum amount a person is willing to pay today to get that payment later.
B) the interest rate equivalent to the foregone stream of income.
C) equal to the borrowed principal minus the total value of interest payments.
D) always larger than the current value of the repayment, once inflation is discounted.

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