Discounting A. Time value of money B. A schedule or table that reports the amount of principal and the amount of interest that make up each payment made to repay loan by the end of its regular term. A type of security that is frequently used in mortgages and requires that the loan payment contain both interest and loan principal. A value that represents the interest paid by borrowers or earned by lenders, expressed as a percentage of the amount borrowed or invested over a 12-month period. A process that involves calculating the current value of a future cash flow or series of cash flows based on a certain interest rate. Amortized loan C. Ordinary annuity D. Annual percentage rate E. One of the four major time value of money terms; the amount to which an individual cash flow or series of cash payments or receipts will grow over a period of time when earning interest at a given rate of interest. A rate that represents the return on an investor's best available alternative investment of Annuity due F. equal risk. Perpetuity G Future value H. The concept that states that the timing of the receipt or payment of a cash flow will affect its value to the holder of the cash flow. A cash flow stream that is created by a lease that requires the payment to be paid on the first of each month and a lease period of three years. A cash flow stream that is generated by a share of preferred stock that is expected to pay dividends every quarter indefinitely. A series of equal cash flows that occur at the end of each of the equally spaced intervals (such as daily, monthly, quarterly, and so on). Amortization schedule I. Opportunity cost of funds J. Time value of money calculations can be solved using a mathematical equation, a financial calculator, or a spreadsheet. Which of the following equations can be used to solve for the present value of an annuity due? O PMT/r O PMT x {[(1 + r)" - 13/r} x (1 + r) O PMT x({1 - [1/(1 + r)"]}/r)(1 + r)