Which of the Following Definitions of "Present Value of an Uneven

Multiple Choice

Which of the following definitions of "Present Value of an Uneven Payment Series" is true?

A) We are calculating the future value of a series of uneven payments by averaging out the uneven payments.
B) We calculate the present value of a series of uneven payments by averaging out the uneven payments.
C) We calculate the present value by using the following equation after taking an average of all payments,
$\begin{array} { c } N \\\text { PVA=PMT } \left. \sum _ { n = 1 } [ 1 / 1 + \mathrm { r } ) ^ { \mathrm { n } } \right]\end{array}$
D) There is no simple equation. We must calculate the present value for each payment separately and then sum up the individual PVs.
E) There is no way to determine this amount accurately.