The future value interest factor is
A) always less than 0.
B) sometimes negative.
C) always greater than 1.0.
D) never greater than 25.

Question

Quizplus · Accepted Answer

The future value interest factor (FVIF) is a factor that is used to calculate the future value of a current sum of money. It is calculated by using the formula: FVIF = (1 + r)n, where r is the interest rate and n is the number of compounding periods. Since the interest rate is always greater than 0 and the number of compounding periods is always greater than or equal to 1, the FVIF is always greater than 1.0. Therefore, the correct answer is C. Choices A and B are incorrect because the FVIF is never negative. Choice D is incorrect because there is no limit to how large the FVIF can be.

The Future Value Interest Factor Is