If the cost of capital is 8% per year, what is the discount factor for a cash flow occurring in 4 years?
A)0.7350
B)1.3605
C)1.0800
D)0.9259

Question

Quizplus · Accepted Answer

The discount factor for a cash flow occurring in 4 years at an 8% cost of capital is calculated using the formula 1/(1+r)^n, where r is the discount rate (0.08) and n is the number of years (4). This calculation gives 1/(1+0.08)^4 = 0.7350.

If the Cost of Capital Is 8% Per Year, What