One way to visualize cash flows, interest rates, and time that is very helpful is to put this information on a:

		timeline.
		space ship.
		discount double check.
		longitudinal study.

5 points

Question 3

The type of interest that does NOT take into account compounding is called:

		compound interest.
		simple interest.
		usury interest.
		riba.

5 points

Question 4

Future value measures:

		what one or more cash flows are worth at the end of a specified period.
		what one or more cash flows that is to be received in the future will be worth today.
		the value of an investment after subtracting interest earned on it for one or more periods.
		the value of an investments worth today.

5 points

Question 5

The process of converting an amount given at the present time into a future value is called:

		annualizing.
		discounting.
		compounding.
		capital budgeting.

5 points

Question 6

Which of the following investments will have the highest future value?

		$1,000 invested at an annual interest rate of 5% for 5 years
		$1,000 invested at an annual interest rate of 5% for 10 years
		$1,000 invested at an annual interest rate of 10% for 5 years
		$1,000 invested at an annual interest rate of 10% for 10 years

5 points

Question 7

Which of the following investments will result in the highest future value?

		$1,000 invested at 10% compounded annually for 5 years.
		$1,000 invested at 10% compounded quarterly for 5 years.
		$1,000 invested at 10% compounded monthly for 5 years.
		$1,000 invested at 10% compounded continuously for 5 years.

5 points

Question 8

The process of converting an amount in the future to the present time is called:

		annualizing.
		discounting.
		compounding.
		capital budgeting.

5 points

Question 9

All else equal, when the discount rate:

decreases, the present value of the future cash flow does not change.

decreases, the present value of any future cash flow increases.

increases, the present value of any future cash flow increases.

One way to visualize cash flows, interest rates, and time that is very helpful is to put this information on a:

		timeline.
		space ship.
		discount double check.
		longitudinal study.

5 points

Question 3

The type of interest that does NOT take into account compounding is called:

		compound interest.
		simple interest.
		usury interest.
		riba.

5 points

Question 4

Future value measures:

		what one or more cash flows are worth at the end of a specified period.
		what one or more cash flows that is to be received in the future will be worth today.
		the value of an investment after subtracting interest earned on it for one or more periods.
		the value of an investments worth today.

5 points

Question 5

The process of converting an amount given at the present time into a future value is called:

		annualizing.
		discounting.
		compounding.
		capital budgeting.

5 points

Question 6

Which of the following investments will have the highest future value?

		$1,000 invested at an annual interest rate of 5% for 5 years
		$1,000 invested at an annual interest rate of 5% for 10 years
		$1,000 invested at an annual interest rate of 10% for 5 years
		$1,000 invested at an annual interest rate of 10% for 10 years

5 points

Question 7

Which of the following investments will result in the highest future value?

		$1,000 invested at 10% compounded annually for 5 years.
		$1,000 invested at 10% compounded quarterly for 5 years.
		$1,000 invested at 10% compounded monthly for 5 years.
		$1,000 invested at 10% compounded continuously for 5 years.

5 points

Question 8

The process of converting an amount in the future to the present time is called:

		annualizing.
		discounting.
		compounding.
		capital budgeting.

5 points

Question 9

All else equal, when the discount rate:

		decreases, the present value of the future cash flow does not change.
		decreases, the present value of any future cash flow increases.
		increases, the present value of any future cash flow increases.
		increases, the present value of any future cash flow does not change.

increases, the present value of any future cash flow does not change.