Which one of the following statements is correct? The discounting factor for an investment over 6 years at 18% is (to 4 decimal places):

Question

Quizplus · Accepted Answer

The discounting factor can be calculated using the formula: 
1 / (1 + r)^t 
Where r is the interest rate and t is the number of years. 
So, for an investment over 6 years at 18%, 
Discounting factor = 1 / (1 + 0.18)^6 = 0.3704 (rounded to 4 decimal places)

Which One of the Following Statements Is Correct? the Discounting