Start now if you want your child to become a tennis multi-millionaire and keep you in old age, though there are much better reasons to get them playing, says Andrew Baker. Smashing fun: four-year-old Lucy works on her double-handed forehand.
38) What is the relationship between present value and future value interest factors? <br />A. The present value and future value factors are equal to each other.<br />B. The present value factor is the exponent of the future value factor.<br />C. The future value factor is the exponent of the present value factor.<br />D. The factors are reciprocals of each other.<br />E. There is no relationship between these two factors.</p>.
This is because the $1 today can be invested to earn interest immediately. The TVM reflects the relationship between present value, future value, time, and interest rate. The time value of money underlies rates of return, interest rates, required rates of return, discount rates, opportunity costs, inflation, and risk. It reflects the relationship between time, cash flow, and interest rate.