Quiz for Assignment 6

The formula for calculating future value (FV) is

• FV = PV/(1+r)^n

• FV = PV/(1+r)*n

• FV = PV x (1+r)^n

• FV = PV x (1+r)*n

The concept of time value of money is:

• The cash flows that occur earlier are more valuable than cash flows that occur later

• The cash flows that occur earlier are less valuable than cash flows that occur later

• The longer the time cash flows are invested, the more valuable they are in the future

• The future value of cash flows are always higher than the present value of the cash flows

Letter of Credit & Guarantee are fund based lending services ?

• True

• False

If funds are not utilized in the manner so that they generate an income higher than the cost of procuring them, there is no point in running the business.

• True

• False

Corporate Finance is to address three major financial decision areas namely:

• Investment

• Financing

• Dividend

• None of the above

Anything that is purchased with the hope that it will generate income or be more valuable at a future date.

• investment

• loan

• income

• expense

The fee for borrowing and using someone else's money.

• expense

• interest

• interest rate

• income

Payment received for goods or services, including employment.

• interest

• dept

• credit

• income