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How does extending the time period to receive a fixed amount of money in the future affect its present value, assuming a constant discount rate?
How does extending the time period to receive a fixed amount of money in the future affect its present value, assuming a constant discount rate?
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The present value remains constant regardless of the time period.
The present value increases as the time period extends.
The present value decreases as the time period extends.
The time period has no impact on present value as long as the sum remains the same.
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