--%>

Present value influenced by change in the discount rate

How is present value influenced by a change in the discount rate?

Present value is inversely associated to the discount rate. In other term, present value moves in the opposite direction of the discount rate. If the discount rate rises up, present value decreases. If the discount rate reduces, present value increases.

   Related Questions in Finance Basics

  • Q : All rates are stated annually with

    1.      Assume the following (all rates are stated annually with semiannual compounding):

  • Q : Size of the labour force net population

    Normal 0 false false

  • Q : Expected rate of return Normal 0 false

    Normal 0 false false

  • Q : Which ratios would banker is interested

    Which ratios would banker is most interested while assuming whether to approve an application for short-term business loan? Illustrate.Bankers and other lenders employ liquidity ratios to distinguish whether to extend short-term credit to a firm

  • Q : Define Subcommittee Subcommittee : The

    Subcommittee: The smaller groupings into which the Senate or Assembly committees are frequently divided. For illustration, the fiscal committees which hear the Budget Bill are classified into subcommittees usually by departments or subject area (examp

  • Q : Define Price Increase Price Increase :

    Price Increase: Budget adjustment to reflect the inflation factors for particular operating expenses constant with the budget instructions from the Department of Finance.

  • Q : What is an Investment Management

    Investment Management: It has two general definitions, one associating to advisory services and the other associated to corporate finance. In the initial instance, a financial advisor or services company gives inve

  • Q : Durable goods industries and

    Normal 0 false false

  • Q : Reimbursement Warrant or Revenue

    Reimbursement Warrant (or Revenue Anticipation Warrant): A warrant which has been sold by the State Controller’s Office, as an outcome of a cash shortage in th

  • Q : Define Grants Grants : It is generally

    Grants: It is generally used to explain amounts of money received by an organization for a particular purpose however with no obligation to repay (that is, in contrast to a loan, though the award might stipulate the repayment of funds under some situa