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The present value of an annuity increases as the discount rate increases. Group of answer choices True False
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The present value of an annuity increases as the discount rate increases. Group of answer choices True False

User Mattisdada
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Answer:

False

Step-by-step explanation:

Discount rate and present value of an annuity are inversely proportionate to each other. If Discount rate increases, then the present value of an annuity decreases. If Discount rate decreases, then the present value of an annuity increases. The annuity FV payments are reduced based on the discount rate. So, the higher the discount rate, the lower the present value of the annuity is and the present value of an annuity is based on the time value of money

User Aisgbnok
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