The higher the interest rate assumed,the
A)higher the present value of an ordinary annuity.
B)more one must deposit today to accumulate to a desired sum.
C)lower the future value of a sum invested in the bank today.
D)lower the present value of a sum due in the future.

Question

Quizplus · Accepted Answer

The higher the interest rate, the lower the present value of a sum due in the future because a higher discount rate is used to calculate present value, reducing the value of future cash flows.

The Higher the Interest Rate Assumed,the