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CLC.C3.2.CF1

Authored by Ngoc Tran

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University

Used 22+ times

CLC.C3.2.CF1
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8 questions

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1.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

An annuity stream of cash flow payments is a set of:

equal cash flows occurring each time period forever

equal cash flows occurring each time period over a fixed length of time

increasing cash flows occurring at set intervals of time that go on forever

equal cash flows occurring each time period under 10 years

2.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

A flow of unending and equal payments that occur at regular intervals of time is called

amortization

perpetuity

annuity

infinite

3.

MULTIPLE CHOICE QUESTION

30 sec • 1 pt

The interest rate charged per period multiplied by the number of periods per year is called the _____ rate

compound interest

effective annual

annual percentage

4.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

An interest rate that is compounded monthly, but is expressed as if the rate were compounded annually, is called the _____ rate

stated interest

effective annual

compound interest

5.

MULTIPLE CHOICE QUESTION

45 sec • 1 pt

Given a stated interest rate, which form of compounding will yield the highest effective rate of interest?

monthly compounding

annual compounding

continuous compounding

6.

MULTIPLE CHOICE QUESTION

2 mins • 1 pt

What is the present value of $6,811 to be received in one year if the discount rate is 6.5 percent?

$7,253.72

$6,395.31

7.

MULTIPLE CHOICE QUESTION

2 mins • 1 pt

Little BA has $2,500 invested at a guaranteed rate of 4.35 percent, compounded annually. What will his investment be worth after five years?

$3,321.32

$3,093.16

$2,857.59

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