Question 1

The time value of money is most commonly applied to two types of cash flows: lump sum and annuity.

Accepted Answer

A) True 
 B)False

Question 2

What is a lump sum?

Accepted Answer

A) A single,one-time payment 
B) All of your money is put together in a pile 
C) A series of equal payments that are made at equal intervals over time 
D) The value of an amount based on the interest rate 
A) A single,one-time payment 
B) All of your money is put together in a pile 
C) A series of equal payments that are made at equal intervals over time 
D) The value of an amount based on the interest rate

Question 3

In which cities are coins for general circulation made?

Accepted Answer

A) Saint Louis and Denver 
B) Philadelphia and Denver 
C) New York and Philadelphia 
D) Washington,D.C.and Philadelphia 
A) Saint Louis and Denver 
B) Philadelphia and Denver 
C) New York and Philadelphia 
D) Washington,D.C.and Philadelphia

Question 4

The ________ frequently interest is compounded,the ________ the yield.

Accepted Answer

A) more; lower 
B) more; higher 
C) less; higher 
D) less; same 
A) more; lower 
B) more; higher 
C) less; higher 
D) less; same

Question 5

Which of the following is paper money backed by today?

Accepted Answer

A) The U.S.president 
B) The full faith and credit of the U.S.government and the Federal Reserve Bank 
C) The Federal Reserve Bank 
D) The Bureau of Engraving and Printing and the Federal Reserve Bank 
A) The U.S.president 
B) The full faith and credit of the U.S.government and the Federal Reserve Bank 
C) The Federal Reserve Bank 
D) The Bureau of Engraving and Printing and the Federal Reserve Bank

Question 6

Paper money is backed by the full faith of the U.S.government and the Federal Reserve Bank.

Accepted Answer

A) True 
 B)False

Question 7

If Phil has a $100,000 bond with a 6% interest rate,compounded annually,how much will he have in 8 years?

Accepted Answer

A) $163,452.83 
B) $170,978.42 
C) $149,867.49 
D) $159,384.81 
A) $163,452.83 
B) $170,978.42 
C) $149,867.49 
D) $159,384.81

Question 8

Which is not a component of the formula APY = (1 + r/n)n - 1?

Accepted Answer

A) n - 1 = Compound minus interest rate 
B) r = Stated annual interest rate 
C) n = Number of times you'll compound every year 
D) APY = Annual percentage yield 
A) n - 1 = Compound minus interest rate 
B) r = Stated annual interest rate 
C) n = Number of times you'll compound every year 
D) APY = Annual percentage yield

Question 9

Prior to 1933,the money in the United States was backed by?

Accepted Answer

A) Gold and the full faith and credit of the U.S government 
B) Silver C.The full faith and credit of the U.S government 
C) The president's oath of office 
D) The Chinese yen 
A) Gold and the full faith and credit of the U.S government 
B) Silver C.The full faith and credit of the U.S government 
C) The president's oath of office 
D) The Chinese yen

Question 10

Using the present value long-hand method,how much money would need to be deposited to earn $5,000 in five years with a 5% interest rate compounded annually?

Accepted Answer

A) $3,917.63 
B) $3,917.00 
C) $3,918.63 
D) $3,918.00 
A) $3,917.63 
B) $3,917.00 
C) $3,918.63 
D) $3,918.00

Question 11

Which example indicates discounting?

Accepted Answer

A) Looking for less inexpensive options when shopping 
B) Figuring out how much money to invest now to have a certain amount in the future 
C) Shoplifting 
D) All of the options are correct. 
A) Looking for less inexpensive options when shopping 
B) Figuring out how much money to invest now to have a certain amount in the future 
C) Shoplifting 
D) All of the options are correct.

Question 12

What is (1+ r/n)n -1?

Accepted Answer

A) Future value (FV) 
B) Annual percentage rate (APR) 
C) Annual percentage yield (APY) 
D) Compound percentage interest (CPI) 
A) Future value (FV) 
B) Annual percentage rate (APR) 
C) Annual percentage yield (APY) 
D) Compound percentage interest (CPI)

Question 13

If you are investing a stream of equal payments that occur at the beginning of each month,what type of investing is this called?

Accepted Answer

A) Lump sum 
B) Annuity due 
C) Discounting 
D) Ordinary annuity 
A) Lump sum 
B) Annuity due 
C) Discounting 
D) Ordinary annuity

Question 14

Where is one place where paper money is printed?

Accepted Answer

A) San Francisco 
B) Washington,D.C. 
C) Denver 
D) Philadelphia 
A) San Francisco 
B) Washington,D.C. 
C) Denver 
D) Philadelphia

Question 15

What gives money its value?

Accepted Answer

A) Supply and demand 
B) Backed by gold 
C) Backed by silver 
D) Present values 
A) Supply and demand 
B) Backed by gold 
C) Backed by silver 
D) Present values

Question 16

Anna is going to deposit $1,000 into an account that has an annual interest rate of 4% compounded quarterly.How much will she have at the end of one year?

Accepted Answer

A) $1,040.60 
B) $1,040.00 
C) $1,056.00 
D) $1,460.00 
A) $1,040.60 
B) $1,040.00 
C) $1,056.00 
D) $1,460.00

Question 17

Which act helped eliminate investor confusion with compounding interest and the related yields?

Accepted Answer

A) The Truth in Savings Act 
B) The Compound Interest Act 
C) The Interest and Yield Act 
D) The Sarbanes Oxley Act 
A) The Truth in Savings Act 
B) The Compound Interest Act 
C) The Interest and Yield Act 
D) The Sarbanes Oxley Act

Question 18

Using mathematical formulas,financial tables,or a financial calculator,you can find the

Accepted Answer

A) future value of an amount invested today. 
B) present value of an amount you will receive in the future. 
C) future value of an amount you deposit annually. 
D) present value of an amount if you make annual payments. 
E) all of the options are correct. 
A) future value of an amount invested today. 
B) present value of an amount you will receive in the future. 
C) future value of an amount you deposit annually. 
D) present value of an amount if you make annual payments. 
E) all of the options are correct.

Question 19

What is paper money backed by?

Accepted Answer

A) Gold 
B) Gold and silver 
C) The full faith and credit of the U.S.government and the Federal Reserve Bank 
D) Silver 
A) Gold 
B) Gold and silver 
C) The full faith and credit of the U.S.government and the Federal Reserve Bank 
D) Silver

Question 20

All of the following are related to the time value of money except

Accepted Answer

A) FVIF. 
B) PVIFI. 
C) PVIF. 
D) FVIFA. 
A) FVIF. 
B) PVIFI. 
C) PVIF. 
D) FVIFA.

The time value of money is most commonly applied to two types of cash flows: lump sum and annuity.

What is a lump sum?

In which cities are coins for general circulation made?

The frequently interest is compounded,the the yield.

Which of the following is paper money backed by today?

Paper money is backed by the full faith of the U.S.government and the Federal Reserve Bank.

If Phil has a $100,000 bond with a 6% interest rate,compounded annually,how much will he have in 8 years?

Which is not a component of the formula APY = (1 + r/n)ⁿ - 1?

Prior to 1933,the money in the United States was backed by?

Using the present value long-hand method,how much money would need to be deposited to earn $5,000 in five years with a 5% interest rate compounded annually?

Which example indicates discounting?

What is (1+ r/n)ⁿ -1?

If you are investing a stream of equal payments that occur at the beginning of each month,what type of investing is this called?

Where is one place where paper money is printed?

What gives money its value?

Anna is going to deposit $1,000 into an account that has an annual interest rate of 4% compounded quarterly.How much will she have at the end of one year?

Which act helped eliminate investor confusion with compounding interest and the related yields?

Using mathematical formulas,financial tables,or a financial calculator,you can find the

What is paper money backed by?

All of the following are related to the time value of money except

Money Matters: Values, vision, mission, and You

Planning and Budgeting

Financial Instruments and Institutions

Consumer Credit: Credit Cards and Student Loans

Credit Bureau Reports and Identity Theft

Auto and Home Loans

Debt,foreclosure,and Bankruptcy

Tax Management

Insurance: Covering Your Assets

Investment Basics

Mutual Funds

Stocks

Bonds

Real Estate Investments

Retirement and Estate Planning

Financial Planning for Life

Filters

Exam 4: Time Value of Money

The time value of money is most commonly applied to two types of cash flows: lump sum and annuity.

What is a lump sum?

In which cities are coins for general circulation made?

The ________ frequently interest is compounded,the ________ the yield.

Which of the following is paper money backed by today?

Paper money is backed by the full faith of the U.S.government and the Federal Reserve Bank.

If Phil has a $100,000 bond with a 6% interest rate,compounded annually,how much will he have in 8 years?

Which is not a component of the formula APY = (1 + r/n)n - 1?

Prior to 1933,the money in the United States was backed by?

Using the present value long-hand method,how much money would need to be deposited to earn $5,000 in five years with a 5% interest rate compounded annually?

Which example indicates discounting?

What is (1+ r/n)n -1?

If you are investing a stream of equal payments that occur at the beginning of each month,what type of investing is this called?

Where is one place where paper money is printed?

What gives money its value?

Anna is going to deposit $1,000 into an account that has an annual interest rate of 4% compounded quarterly.How much will she have at the end of one year?

Which act helped eliminate investor confusion with compounding interest and the related yields?

Using mathematical formulas,financial tables,or a financial calculator,you can find the

What is paper money backed by?

All of the following are related to the time value of money except

Money Matters: Values, vision, mission, and You

Planning and Budgeting

Financial Instruments and Institutions

Consumer Credit: Credit Cards and Student Loans

Credit Bureau Reports and Identity Theft

Auto and Home Loans

Debt,foreclosure,and Bankruptcy

Tax Management

Insurance: Covering Your Assets

Investment Basics

Mutual Funds

Stocks

Bonds

Real Estate Investments

Retirement and Estate Planning

Financial Planning for Life

Filters

The frequently interest is compounded,the the yield.

Which is not a component of the formula APY = (1 + r/n)ⁿ - 1?

What is (1+ r/n)ⁿ -1?