Suppose you used the PV Excel function to determine whether an investment now would create enough profits in the future to be wise and it showed the PV to be $1 million This investment is
A)Wise
B)Unwise
C)Wise if you would have to invest less than $1 million to earn those profits and unwise otherwise.
D)Wise if you would have to invest more than $1 million to earn those profits and unwise otherwise.

Question

Quizplus · Accepted Answer

The PV (Present Value) function calculates the present value of future cash flows. If the present value of future profits is $1 million, the investment is wise if the initial investment is less than $1 million (since you'd be getting more in present value terms than you're putting in) and unwise if the initial investment exceeds $1 million (since you'd be putting in more than you'd be getting back in present value terms).

Suppose You Used the PV Excel Function to Determine Whether