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1) Present value calculations: A) are appropriate for investments in the same time period B) are accurate only in a low-rate
18) Which of the following best describes the segmented markets theory? A) It assumes that bonds with different maturities ar
24) The yield curve for U.S. government notes and bonds: A) is always positive since inflation cannot be measured B) is not d
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Answer #1

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Answer to Question 1

The answer is Option D. PV or present value calculates and gives the present value of each investment considering the time value of money. And helps the investors in comparing investments with different time horizons, since all the value to be earned in future periods is brought down to its common reference time period.

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