As the interest rate increases, the present value of an amount to be received at the end of a fixed period
A)increases.
B)decreases.
C)remains the same.
D)Not enough information is given to tell.

Question

Quizplus · Accepted Answer

As the interest rate increases, the discount rate used to calculate the present value also increases, leading to a decrease in the present value of the future amount.

As the Interest Rate Increases, the Present Value of an Amount