Firm A receives revenue of $100 million in 5 years time and another $100 million at the end of 10 years. Firm B receives $200 million at the end of 10 years. Which Firm is more adversely affected by an increase in discount rate from 2% to 5% (assume identical costs)?

a.

Firm B

b.

They are equally impacted since the total revenue is $200 million in both cases

c.

Firm A

d.

It is not possible to say, since the timing of cashflows is not identical across firms