You are expecting to receive $750 at some time in the future.Which of the following would unambiguously decrease the present value of this future payment?
A)Interest rates rise and you get the payment sooner.
B)Interest rates rise and you have to wait longer for the payment.
C)Interest rates fall and you get the payment sooner.
D)Interest rates fall and you have to wait longer to get the payment.

Question

Quizplus · Accepted Answer

An increase in interest rates and a longer wait for the payment both contribute to a decrease in the present value of the future payment.

You Are Expecting to Receive $750 at Some Time in the Future.Which