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Is it possible to have the present value of a future payment that is greater than the future payment (i.e. the present value is $1200, and the future payment is $1000)? Explain, using complete, grammatically-correct sentences.

Sagot :

Martebi

Note that the present value always less than the future value and so Is it not possible to have the present value of a future payment that is greater than the future payment.

Can present value be greater than future cash flows?

The present value is known to be often less than the future value this is due to the reason that money has interest-earning rate on top of it.

So therefore, that base on the fact that as long as interest rates are positive, then the present value of a sum of money will have to be less than its future value.

Learn more about present value from

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