Below are excerpts from interest tables for 8% interest. $\begin{array} { c c c c c } & \underline { 1 } & \underline { 2 } & \underline { 3 } & \underline { 4 } \\ 1 & 1.0000 & 0.92593 & 1.08000 & 0.92593 \\ 2 & 2.0800 & 0.85734 & 1.16640 & 1.78326 \\ 3 & 3.2464 & 0.793833 & 1.25971 & 2.57710 \\ 4 & 4.5061 & 0.73503 & 1.36049 & 3.31213 \end{array}$ Column 2 is an interest table for the:

A) Future value of $1. B) Present value of $1. C) Future value of an annuity of $1. D) Present value of an annuity of $1. A) Future value of $1. B) Present value of $1. C) Future value of an annuity of $1. D) Present value of an annuity of $1.

Exam 13: Time Value of Money

Below are excerpts from interest tables for 8% interest. 1 1.0000 0.92593 1.08000 0.92593 2 2.0800 0.85734 1.16640 1.78326 3 3.2464 0.793833 1.25971 2.57710 4 4.5061 0.73503 1.36049 3.31213 Column 2 is an interest table for the:

(Multiple Choice)

4.9/5

(40)

Question 61

Sandra won $5,000,000 in the state lottery which she has elected to receive at the end of each month over the next thirty years.She will receive 7% interest on unpaid amounts.To determine the amount of her monthly check,she should use a table for the:

(Multiple Choice)

4.7/5

(40)

Question 62

How much will $25,000 grow to in seven years,assuming an interest rate of 12% compounded annually?

(Multiple Choice)

4.8/5

(35)

Question 63

Two banks each have stated CD rates of 12%.Bank A compounds quarterly and Bank B compounds semiannually.Explain which bank offers the better CD.

(Essay)

4.8/5

(34)

Question 64

An annuity is a series of equal cash payments over equal time intervals.

(True/False)

4.8/5

(36)

Question 65

At the end of the next four years,a new machine is expected to generate net cash flows of $8,000,$12,000,$10,000,and $15,000,respectively.What are the cash flows worth today if a 3% interest rate properly reflects the time value of money in this situation?

(Multiple Choice)

4.8/5

(33)

Question 66

The time value of money is a concept which means that the value of $1 increases over time.

(True/False)

4.9/5

(42)

Question 67

The future value of $1,000 invested today for three years that earns 10% compounded annually is greater than the future value of a $500 annuity with the same interest rate over the same period.

(True/False)

4.9/5

(45)

Question 68

Listed below are ten terms followed by a list of phrases that describe or characterize five of the terms.
Match each phrase with the best term placing the letter designating the term in the space provided.

Accumulation of an amount with interest.

Future value of an annuity

Interest earned on the initial investment and on previous interest.

Discount rate

A series of equal periodic payments.

Time value of money

Correct Answer:

Verified

Accumulation of an amount with interest.

Interest earned on the initial investment and on previous interest.

A series of equal periodic payments.

Accumulation of a series of equal payments.

A dollar now is worth more than a dollar later.

(Matching)

4.9/5

(41)

Question 69

The concept that interest causes the value of money received today to be greater than the value of that same amount of money received in the future is referred to as the:

(Multiple Choice)

4.8/5

(50)

Question 70

Anthony would like to have $18,000 to buy a new car in three years.Currently,he has saved $15,000.If he puts $15,000 in an account that earns 6% interest,compounded annually,will he be able to buy the car in three years?

(Short Answer)

4.9/5

(41)

Question 71

The value of $1 today is worth more than $1 one year from now.

(True/False)

4.7/5

(37)

Question 72

The discount rate is the rate at which someone is willing to give up current dollars for future dollars.

(True/False)

4.9/5

(36)

Question 73

What is the value today of receiving five annual payments of $500,000,beginning one year from now,assuming an 11% discount rate?

(Multiple Choice)

4.8/5

(40)

Question 74

Showing 61 - 74 of 74

Below are excerpts from interest tables for 8% interest. 1 1.0000 0.92593 1.08000 0.92593 2 2.0800 0.85734 1.16640 1.78326 3 3.2464 0.793833 1.25971 2.57710 4 4.5061 0.73503 1.36049 3.31213 Column 2 is an interest table for the:

Sandra won $5,000,000 in the state lottery which she has elected to receive at the end of each month over the next thirty years.She will receive 7% interest on unpaid amounts.To determine the amount of her monthly check,she should use a table for the:

How much will $25,000 grow to in seven years,assuming an interest rate of 12% compounded annually?

Two banks each have stated CD rates of 12%.Bank A compounds quarterly and Bank B compounds semiannually.Explain which bank offers the better CD.

An annuity is a series of equal cash payments over equal time intervals.

At the end of the next four years,a new machine is expected to generate net cash flows of $8,000,$12,000,$10,000,and $15,000,respectively.What are the cash flows worth today if a 3% interest rate properly reflects the time value of money in this situation?

The time value of money is a concept which means that the value of $1 increases over time.

The future value of $1,000 invested today for three years that earns 10% compounded annually is greater than the future value of a $500 annuity with the same interest rate over the same period.

The concept that interest causes the value of money received today to be greater than the value of that same amount of money received in the future is referred to as the:

Anthony would like to have $18,000 to buy a new car in three years.Currently,he has saved $15,000.If he puts $15,000 in an account that earns 6% interest,compounded annually,will he be able to buy the car in three years?

The value of $1 today is worth more than $1 one year from now.

The discount rate is the rate at which someone is willing to give up current dollars for future dollars.

What is the value today of receiving five annual payments of $500,000,beginning one year from now,assuming an 11% discount rate?

Accounting Information and Decision Making

The Accounting Information System

The Financial Reporting Process

Cash and Internal Controls

Receivables and Sales

Inventory and Cost of Goods Sold

Long-Term Assets

Current Liabilities

Long-Term Liabilities

Stockholders Equity

Statement of Cash Flows

Financial Statement Analysis

Investments

International Financial Reporting Standards

Filters