4189922
Question 1
Question
tick marks designate ___ of periods
Answer
-
end
-
beginning
-
middle
-
zero
Question 2
Question
time 0 is the ''starting'' point ( beginning of period 1)
time 1 is the ''end'' of period 1 (the beginning of period 2) ; and so on
Answer
- True
- False
Question 3
Question
finding future values (moving to the __ along the time line) is called ___
Answer
-
left
-
right
-
top
-
down
-
beginning
-
middle
-
compounding
Question 4
Question
3 primary methods to find FVs
Answer
-
solve the fv equation using a regular (non-financial) calculator
-
use a financial calculator, that is one with financial functions
-
use a computer with a spreadsheet program such as excel, lotus 1-2-3, or quattro pro
Question 5
Question
finding present values (moving to the ___ along the time line) is called ___
Answer
-
left, discounting
-
right, discounting
-
left, expenses
-
right, expenses
Question 6
Question
Where did the discount rate come from?
Answer
-
discount rate is the ''opportunity cost rate''
-
it does not depend on the source of the investment funds
-
rate could be earned on alternative investments of ''similar risk''
Question 7
Question
a perpetuity is an annuity that lasts _____
Answer
-
a short period of time
-
a long period of time
-
forever
-
1 day
Question 8
Question
an annuity is a series of ''___ payments'' at fixed intervals for a specified number of period
Answer
-
discounted
-
undiscounted
-
equal
-
same
-
risky
Question 9
Question
symbol ''PMT'' represents annuity __
Answer
-
payments
-
cash
-
transaction
Question 10
Question
2 types of annuity:
1) ordinary annuity - occurs at the ______ of each period
2) annuity due - payments are made at the ___ of each period
Answer
-
beginning, end
-
end, beginning
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