The current value of a future cash flow is referred to as its:
A)future value
B)present value
C)investment value
D)discount rate

Question

Quizplus · Accepted Answer

The current value of a future cash flow is referred to as its present value. This is because the cash flow is being evaluated in terms of its current worth, taking into account factors such as inflation and the time value of money. Future value refers to the value of the cash flow at a future point in time, and investment value is a broader term that encompasses a range of factors that investors consider when making investment decisions. Discount rate is the rate used to discount future cash flows to their present value.

The Current Value of a Future Cash Flow Is Referred