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An Important Element in Estimating the Present Value of an Investment

Question 17

Multiple Choice

An important element in estimating the present value of an investment is the calculation of the discount factor. The discount factor may be expressed as _______ where r is the discount rate and n is the number of years the investment is held.


A) 1 + r) n
B) 1 + n) r
C) 1/1 + r) n
D) 1/1 + n) r

Correct Answer:

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