Chapter 06 Discounted Cash Flow Valuation
1. An abnormal annuity is greatest outlined by which one in every of the next? A. growing funds paid for a definitive time period B. growing funds paid perpetually C. equal funds paid at common intervals over a acknowledged time interval D. equal funds paid at common intervals of time on an ongoing foundation E. unequal funds that happen at set intervals for a restricted interval of time 2. Which one of many following precisely defines a perpetuity? A. a restricted variety of equal funds paid in even time increments B. funds of equal quantities which are paid irregularly however indefinitely C. various quantities which are paid at even intervals perpetually D. endless equal funds paid at equal time intervals E. endless equal funds paid at both equal or unequal time intervals three. Which one of many following phrases is used to determine a British perpetuity? A. abnormal annuity B. amortized money circulate C. annuity due D. discounted mortgage E. consol four. The rate of interest that's quoted by a lender is known as which one of many following? A. acknowledged rate of interest B. compound price C. efficient annual price D. easy price E. widespread price 5. A month-to-month rate of interest expressed as an annual price could be an instance of which one of many following charges? A. acknowledged price B. discounted annual price C. efficient annual price D. periodic month-to-month price E. consolidated month-to-month price 6. What's the rate of interest charged per interval multiplied by the variety of durations per 12 months referred to as? A. efficient annual price B. annual proportion price C. periodic rate of interest D. compound rate of interest E. day by day rate of interest 7. A mortgage the place the borrower receives cash right this moment and repays a single lump sum on a future date is named a(n) _____ mortgage. A. amortized B. steady C. balloon D. pure low cost E. interest-only eight. Which one of many following phrases is used to describe a mortgage that requires periodic curiosity funds and a lump sum principal fee? A. amortized mortgage B. modified mortgage C. balloon mortgage D. pure low cost mortgage E. interest-only mortgage 9. Which one of many following phrases is used to describe a mortgage whereby every fee is equal in quantity and contains each curiosity and principal? A. amortized mortgage B. modified mortgage C. balloon mortgage D. pure low cost mortgage E. interest-only mortgage 10. Which one of many following phrases is outlined as a mortgage whereby the common funds, together with each curiosity and principal quantities, are inadequate to retire your complete mortgage quantity, which then should be repaid in a single lump sum? A. amortized mortgage B. persevering with mortgage C. balloon mortgage D. the rest mortgage E. interest-only mortgage