h 05: Assignment - Time Value of Money Answer Term Discounting A. Time value of money B. Amortized loan c. Ordinary annuity D. E Annual percentage rate Annuity due Description A series of equal cash flows that occur at the beginning of each of the equally spaced intervals (such as daily, monthly, quarterly, and so on). A cash flow stream that is created by an investment or loan that requires its cash flows to take place on the last day of each quarter and requires that it last for 10 years. A table that reports the results of the disaggregation of each payment on an amortized loan, such as a mortgage, into its interest and loan repayment components. A series of equal (constant) cash flows (receipts or payments that are expected to continue forever. A loan in which the payments include interest as well as loan principal A process that involves calculating the current value of a future cash flow or series of cash flows based on a certain interest rate. 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. An interest rate that reflects the return required by a tender and pold by a borrower expressed as a percentage of the principal borrowed. A 6% return that you could have earned if you had made a particular investment. The name given to the amount to which a cash flow, or a series of cash flows, will grow over a given period of time when compounded at a given rate of interest E. Perpetuity G Future value H. 1. Amortization schedule Opportunity cost of funds J. Time in marianne on har ad 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 a perpetuity? PMT/ PV/(1+r)" PVX (1+r)" PMTX ((1 - 11/(1+r)"]}/0)