Discounting is the process of dividing a future value by the_____ to obtain the_____ value.
A)discount factor; past
B)discount factor; present
C)rate of discount; past
D)rate of discount; present

Question

Quizplus · Accepted Answer

Discounting involves calculating the present value of a future value, so the discount factor used will be in the present. Therefore, the correct options are either "discount factor; present" or "rate of discount; present". Among the given options, the best choice is B, "discount factor; present".

Discounting Is the Process of Dividing a Future Value by The_____