What is the relationship between interest rate (I) and present value (PV)? Are they moving in...

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Finance

What is the relationship between interest rate (I) and presentvalue (PV)? Are they moving in the same direction, or the oppositedirection?
Using your answer in part 1 to explain how financial marketsreact when the Federal Reserve announces interest rate increase (socalled "Federal Fund rate"). Will the markets rise or decline? Whydo investors/markets react that way?
From what we learned in chapter 8, which type of bonds can helpwealthy investors to save taxes? Which type of bonds providesprotection against inflation?
Most of full-time employees in America have an employersponsored retirement account called 401K. Some people also like toset up their own retirement account so called IRA and Roth IRA. Dosome research on the internet to find what is the benefit of eachof these three types of retirement account? And which type(s) doyou have or plan to have.
Given the current US economy, do you think our stock market isstrong? Will it continue to rise? Use 4-7 sentences to share yourpersonal opinion.

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3.6 Ratings (584 Votes)

1 There exists an inverse relationship between interest rate I and present value PV In other words they move in the opposite direction The higher the interest rates the lower will be the amount of PV and the See Answer

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What is the relationship between interest rate (I) and presentvalue (PV)? Are they moving in the same direction, or the oppositedirection?Using your answer in part 1 to explain how financial marketsreact when the Federal Reserve announces interest rate increase (socalled "Federal Fund rate"). Will the markets rise or decline? Whydo investors/markets react that way?From what we learned in chapter 8, which type of bonds can helpwealthy investors to save taxes? Which type of bonds providesprotection against inflation?Most of full-time employees in America have an employersponsored retirement account called 401K. Some people also like toset up their own retirement account so called IRA and Roth IRA. Dosome research on the internet to find what is the benefit of eachof these three types of retirement account? And which type(s) doyou have or plan to have.Given the current US economy, do you think our stock market isstrong? Will it continue to rise? Use 4-7 sentences to share yourpersonal opinion.