QUESTION 1 Match the Definition to the appropriate term Interest paid on principal only A Simple Interest Interest paid on interest B. Compound The current worth of a future sum of C. Present Value money or stream of cash flows given a D. Future Value specified rate of return. E. Time Value of Money Concept Amount that a current sum of money F. Risk, uncertainty, economy, responsibility of earning a stated rate of interest will management personnel over long period of accumulate to at the end of a future period. time etc. Money paid at different times has to be G. Identifying potentially desirable projects for adjusted to be comparable. A $1 today is not capital expenditures. Usually involves worth the same as a $1 in one year. evaluating cash flows for periods greater than 1 year. Challenges of Capital Budgeting H. Investments of resources in long term assets such as buildings, machines, to develop or Capital Budgeting introduce new products/services, expand Capital Expenditures capacity, or change facilities