Time value of money multiple choice questions and answers
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In addition, other concepts that relate to factors that can impede the growth in value of money over time are explained, including risk, inflation and accessibility of assets. Stein need to achieve this goal? Holding all other variables constant, an increase in the interest rate will cause a. Of course, present value is what you have right now at this present time. Find the compound interest on Rs. Our website is also encrypted to ensure additional security. Stocks valuation and stock market equilibrium quiz has 85 multiple choice questions. Terms of credit do not include: a interest rate b collateral c documentation d lender's land 12.

How much will you have after 5 years? How much will she have on December 31, 2004? The Swell Computer Company has developed a new line of desktop computers. . Learning Objective: 09-05 Compounding or discounting may take place on a less than annual basis such as semiannually or monthly. Interest rates in the following questions are compound rates unless otherwise stated 3. The concept of time value of money is important to financial decision making because A. Formal sources of credit do not include: a banks b cooperatives c employers d none of these 13. You expect annual interest rates will be 8 percent over that time period.

The principle behind time value of money is based on the fact that a a sum of money in hand today is worth more than the same sum in the future b. Authenticity We write all our papers from scratch and never plagiarize at all. If the compound interest on a certain sum of money for 2 ½ years at 5% per annum be Rs. As a result, a dollar saved today will be worth more in the future, and a dollar paid today costs more than a dollar paid later in. Abstract In this paper, Team C will discuss the concept of the time value of money and the importance of this concept in business. The simple interest on a certain sum of money for 4 years at 4 percent per annum exceeds the compound interest on the same sum for 3 years at 5 percent per annum by Rs. The annual interest rate is: a.

How much should he be willing to pay to get out of a 14 percent mortgage and into a 10 percent mortgage with 25 years remaining on the mortgage? What type of annuity is. A certain sum lent out at simple Interest and the true discount on a certain sum for 1 year at 5% is Rs. The Swell Computer Company has developed a new line of desktop computers. The rate of interest is 10% per annum. An ordinary annuity has payments at the end of each year. Rule 415 the Rule of 72 the Rule of 78 Rule 144 12.

Practice with multiple choice question: proceeds of company shares of sold stock is recorded in, to learn finance courses with options common stock account, preferred stock account, due stock account, preceded stock account for finance director jobs. In a typical loan amortization schedule, the dollar amount of interest paid each period. Your local travel agent is advertising an extravagant global vacation. We use the formula: Total return - initial capital outlay x 100 divided by the time period of project Initial capital outlay 7. The money will be used for his son's education 15 years from now.

In addition, we never sell your paper nor divulge the paper or client details to anyone. Then the sum is a Rs. Chapter 5: Time Value of Money Multiple Choice Questions 1. Learning Objective: 09-04 Not only can future value and present value be computed; but other factors such as yield rate of return can be determined as well. With the certificate of deposit, you make an initial investment at the beginning of the first year. What rate of return will Dr.

Which of the following statements about time lines is false? Present value of a single amount C. An annuity due has payments at the beginning of each year. Learning Objective: 09-04 Not only can future value and present value be computed; but other factors such as yield rate of return can be determined as well. How much will his annual payments be? At what rate percent per annum will a sum of Rs. If the annual interest is Rs. The rate percent per annum is: a 2% b 4% c 5% d 10% Ans.

At what rate percent per annum will a sum of Rs 2000 amount to Rs 2205 in 2 years, compounded annually? The compound annual interest rate implied by this arrangement is closest to 8 percent. Under what conditions must a distinction be made between money to be received today and money to be received in the future? Time value of money can also be used to compute such useful information as car, mortgage and other loan payments. Bonds and bond valuation quiz has 83 multiple choice questions. What will be the amount at the end of five years? Modern forms of money include: a paper notes b gold coins c silver coins d copper coins 3. A time line is a graphic portayal of a time vas s false? Depreciation is charged on a straight line basis over the assets useful life. Which of the following cash-inflow streams should you prefer? When there is no risk of nonpayment in the future.

He can buy the lot today and expects the. Learn , time value of money quiz questions and answers. Chapter 3 Multiple-Choice Quiz Multiple-Choice Quiz Chapter 3: The Time Value of Money Just click on the button next to each answer and you'll get immediate feedback. The annual interest rate on the loan is 12 percent of the unpaid balance. Five years with a simple annual interest rate of 10 percent B. Financial options and applications in corporate finance quiz has 68 multiple choice questions.