Holding all other variables constant, an increase in the interest rate will cause ____ to decrease.
A)future values
B)present values
C)annuity payments
D)growth rates

Name: Holding all other variables constant, an increase in the interest rate will cause ____ to decrease. A)future values B)present values C)annuity payments D)growth rates
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Question

Quizplus · Accepted Answer

An increase in the interest rate will decrease present values because it means that future cash flows are worth less in today’s dollars.

Holding All Other Variables Constant, an Increase in the Interest