How will the present value of a future amount be affected if the number of compounding increases?
A)The present value will increase
B)The present value will decrease
C)The present value will not change
D)Must know the amount of the future value before this can be answered

Question

Quizplus · Accepted Answer

The present value of a future amount will decrease if the number of compounding increases because with more compounding, the amount earns more interest, which makes the future value greater. As the future value increases, the present value decreases.

How Will the Present Value of a Future Amount Be