Selett ar,e:

..

3. You invested in a project that w ill return Sl0(l, $300, $300 and - S50 lor years 1, 2, 3 and 4,
respectively.

What is the Present value of the project if the discount factor is 10% 7

PV =lOO[tl+0.l)+ 300/(1 +ail) 2+ 300/(1+0.1)1 -50/(1+0.1)' = 530.15

4. W hat would be the future value of a CD of $1,000 For two years if the bank offered a 10% interest rate
compaunded semiannually?

FV = 1000(1+0.05)4 = 1215_5

4 . What would be the future value of a CDpf $1,000 For two years if the bank offered a 10% interest rate
compaunded semiannually?

FV = 1000(1+0.05)'= 1215.5
EAR quarterly EAR dally _ _ _ EARmorthly__ _ _ EARannually _ _ _ EAR
semiannually

Select one:

r a.< > < <

r b.< < > =

r
~· < = > <

r JI.> < > <

(o
e.< > > <

14. 'Going public' is !he same as IPO I

Select one:

(o
True

r False

8. The futur& valu& of $100 received todat and deposited at 6 pucent for four years Is

FV • 100(1+0.06)'= 126.24

10. All of the following accounts are considered to be current assets on the balanc.e ,s heet e ,ccept

Select one:

r a. inventory

(o
b. accruals

r c. cuh

r Q. accounts rece ivable s

 6. With compound interest, interest is earned only on the investment's principal.

Select one:

r True

r- False

15. The future value of S200 received today and deposited for three years in an account which earns
semiannual interest of 8 percent is

5. Finance is

Select one:

vi a. the study of how individuals, institutions, governm'!?nts, and businesses acquire, spend, and
manage money and other financial assets

r J!. the study ol how governments, and businesses acquire, spend, and manage money and other
financial assets

r f. the study of how money is used to purchase goods and se,vices

r fl. the study of how businesses acquire, spend, and manage money and other financial a.sets
 You have project A and project B

Their cashflows are looking as follows

Project A Project B

year casnnow year casnnow

0 -500 0 -500

200 800

2 400 2 400

3 800 3 200

Project A wiD be discounted at 5% while project B will be discounted at 20%_ WITHOUT any calculation please select which project is more profrtable
Ai)r 14 Senlfr1> Web

.a. projec1 B 1s more profrtabfe

I 6_pro1ect A 1s more profiiablel
c. botn, prOject A and project B are equally profrtable
Apr 14 Sent from Web

On the balance sheet, total assets minus net fixed assets equals:

Select one:
Ia. current assets I
b. total assets
c. gross fixed assets
d. current liabilities
Apr 14 · Sent from Web

same as rorar sares

d equal ro cash now

e ne prom before taxes plus ~ b o i l

The goal of any firm should be the maximization of sales (revenues). FALSE

The value of money results from: its purchasing power.

Interest earned only on an investments principal or original amount is referred to: SIMPLE INTEREST.

More frequently compounding occurs _____indifferent____ the effective annual rate.

The current liabilities of a business may include:

Select one:

a. prepaid expenses

b. inventory

c. notes payable

d. depreciation reserves

e. accounts receivable