The assumed rate of interest that affects the present value of a cash flow to determine its future value is known as the _____.
A) increase rate
B) riskreturn tradeoff
C) risk rate
D) discount rate

Question

The assumed rate of interest that affects the present value of a cash flow to determine its future value is known as the _____.
A) increase rate
B) risk­return tradeoff
C) risk rate
D) discount rate

Quizplus · Accepted Answer

The assumed rate of interest that affects the present value of a cash flow to determine its future value is known as the discount rate. Therefore, the correct answer is option D.

The Assumed Rate of Interest That Affects the Present Value