Present value is

Name: Present value is
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Present value is

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Present value is the current value of a future cash flow or a stream of future cash flows expressed in today's dollars. It takes into consideration the time value of money, which means that money is worth more now than in the future. Therefore, the longer the time horizon, the lower the present value. The rate of interest is a key factor that affects the present value, as a higher interest rate would increase the present value and vice versa.

Present Value Is