Question

Present value is not: a. The sum of a series of payments. b. Always smaller than the future value. c. The amount that must be invested now to produce a known future value. d. The value now of a future amount.

Answer 1

Answer:

The answer is A.

Explanation:

Present Value is a value of tomorrow's worth of money.

Present Value is when the future of money is discounted using a discount rate or rate of expected returns.

It is the amount of money that must be invested now to generate a target future amount.

Because it is discounting future value, present value is usually lower than future value.

It is not usually the sum of a series of payment. Money is paid now.