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professor190 [17]
3 years ago
8

Select the best (most informative) answer. present value involves _____ whereas future value involves _____.

Business
1 answer:
Marina CMI [18]3 years ago
4 0
Present Value involves discounting, and future value involves compounding.

The find present value of a dollar a year from now, we must discount by the discount rate, since a dollar a year from now is not worth as much as a dollar today.

To find the future value (in a year) of a dollar we receive today, we increase the dollar by the discount rate, since our dollar today is worth more than a dollar a year from now. 
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3 years ago
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BabaBlast [244]

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