Final answer:
A higher discount rate contributes to a lower present value of a given future value, while fewer time periods and less frequent discounting contribute to a higher present value. A lower discount factor also results in a lower present value.
Step-by-step explanation:
The question is asking which factors would contribute to a lower present value given a set future value. To answer this question, we need to consider how the present discounted value is calculated. The present discounted value is found by applying a formula that takes into account the future value, the discount rate, the number of time periods, and the frequency of discounting.
For a given future value, a higher discount rate typically results in a lower present value. This is because the discount rate reflects the rate at which future earnings are brought back to their present-day value. A higher rate implies that future benefits are deemed less valuable in today's terms, reducing the present value.
On the other hand, fewer time periods and less frequent discounting would typically lead to a higher present value. These factors reduce the extent of the 'discounting effect' over time. Lastly, a lower discount factor (which is a function of the discount rate and the number of time periods) would also contribute to a lower present value.
The key takeaway is that the higher the discount rate or the greater the number of time periods and the frequency of discounting, the lower the present value would be for a given future value.