Amortization, Stocks, and Bonds Quiz

What does amortization of a debt mean?

• Extinction of the debt by equal payments

• Increasing the debt amount

• Paying only the interest

• Transferring the debt to another party

What is the present value of an annuity in relation to amortization?

• The total amount of interest paid

• The future value of the debt

• The original amount of debt or loan

• The total number of payments

What is the first step in computing an amortization schedule?

• Find the outstanding principal after the preceding payment

• Subtract interest from the payment

• Determine the total debt

• Compute interest for one interval

What does the term 'par value' refer to?

• The total number of shares

• The total dividends paid

• The value printed on a stock certificate

• The market value of a stock

How is a stockholder's share of the company's earnings calculated?

• Based on the number of employees

• Based on the total assets of the company

• Based on the par value and dividend rate

• Based on the market value

What formula is used to compute a stockholder's ownership?

• P = ST / SO

• P = SO / ST

• P = SO + ST

• P = ST - SO

Tags

CCSS.6.EE.B.6

What are bonds considered to be?

• Shares of stock

• Equity in a company

• Loans made to organizations

• Dividends paid to stockholders

How is the interest on a bond computed?

• Using the simple interest formula

• Based on the total dividends

• Based on the market value

• Using the compound interest formula

Tags

CCSS.HSF.BF.A.2

What is the current yield of a bond?

• The total dividends paid

• The annual interest divided by the purchased price

• The annual interest divided by the par value

• The market value of the bond

Tags

CCSS.8.EE.C.7B

What is the purpose of amortization?

• To determine stock ownership

• To calculate dividends

• To discharge liabilities through payments

• To increase the debt amount