FIGURE 5 PRESENT VALUE OF $1,000 TO BE PAID IN 30 YEARS DISCOUNTED AT 1%, 5%, AND 10%
imageThis figure is a reminder of the effects discount rates have on the present value of a fixed payment that will come due at a future date. A higher discount rate means that the value today of a future payment will be lower. The higher the discount rate we choose, the lower the value we place on the environmental damage to be suffered by future generations. The lower our discount rate, the more we are willing to protect the health of the future environment.