Worksheetsbasics of finance
Total questions: 9
Worksheet time: 4mins
84. What is an Uneven Cash Flow Stream?
Any series of cash flows that conform to the definition of an annuity
Any series of cash flows that doesn't conform to the definition of an annuity
Cash flows can vary constantly
No correct answer
85. A cash flow that grows at a constant rate for a specified period of time ...?
Present value of a Growing Annuity
Future value of a deffered annuity
Present value of annuity due
Future value of an ordinary annuity
86. What causes Price Risk?
Long-term bonds have more price risk than short-term bonds
Poor business management
Change in price due to changes in interest rates
All the answers are correct
87.What causes Reinvestment Rate Risk?
Uncertainty concerning rates at which cash flows can be reinvested
Short-term bonds have more reinvestment rate risk than long-term bonds
A future drop in interest rates
All the answers are correct
88. What does Yield-to-maturity apply to?
The Rate implied by the current bond price
The rate implied by the expected bond price
The rate implied by th past bond price
No correct answer
89. What is a Bond Indenture?
Contract between the company and the shareholders
Contract between the government and companies
Contract between the company and the bondholders
Nocorrect answer
90. What does a Bond Indenture consist of?
The basic terms of the bonds
A description of property used as security, if applicable
All the answers are correct
Details of protective covenants
91.What is a holding-period return?
the arithmetic mean or average of all possible outcomes where those outcomes are weighted by the probability that each will occur.
the potential variability in future cash flows
computing the variance in the possible investment returns
the rate of return earned on an investment, which equals the dollar gain divided by the amount invested.
92.What is expected rate of return?
the rate of return earned on an investment, which equals the dollar gain divided by the amount invested.
the arithmetic mean or average of all possible outcomes where those outcomes are weighted by the probability that each will occur.
the potential variability in future cash flows
computing the variance in the possible investment returns
