The amount to be invested now to accumulate to a certain amount in the future at a specified interest rate is called the:
A) time value of money.
B) present value of an investment.
C) future value of an investment.
D) None of the above.

Question

Quizplus · Accepted Answer

The question describes the calculation for present value, which is the amount to be invested now in order to achieve a desired future value at a specified interest rate. Time value of money refers to the concept that money received or paid out at different points in time have different values due to factors such as inflation and interest rates. Future value of an investment refers to the expected value of an investment at a future point in time, given a certain interest rate and time period. Therefore, the correct answer is B - present value of an investment.

The Amount to Be Invested Now to Accumulate to a Certain