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the process of caltucalting the present value of a future cash flow is calked compouding? true...

the process of caltucalting the present value of a future cash flow is calked compouding?
true or false
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Answer #1

Answer : False

This is false because the process of calculating the present value of future cash flow is called discounting where we discount the cash flows occuring in the future by the discount rate to get the present value of cash flow. Compouding on the other hand is the process of calculating the future value of the cash flow using the series of cash flows and the compouding rate.

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