The value today of all future cash flows discounted to the present at the investor's required rate of return is called the:
A)horizon value
B)present value
C)terminal value
D)reversion value

Question

Quizplus · Accepted Answer

The definition given in the question matches with the concept of present value. Horizon value refers to the value of an asset at a specific point in the future. Terminal value refers to the value of an asset at the end of its useful life. Reversion value is a term used in real estate valuation and refers to the estimated value of a property at the end of a specific holding period.

The Value Today of All Future Cash Flows Discounted to the Present