The present value of $1 means that for a certain rate of interest for a certain period of time will equal:
A) $1
B) Over $1
C) Less than $1
D) Never equal
E) None of these

Question

Quizplus · Accepted Answer

The present value of $1, also known as the discount factor or present discounted value, is the amount of money that needs to be invested today at a given interest rate to equal $1 in the future. Therefore, the present value of $1 will always be less than $1.

The Present Value of $1 Means That for a Certain