Multiple choice
Thehonest (Not rated)
(Not rated)
1. If the present value of the cash flow X is $240, and the present value cash flow Y $160, then
the present value of the combined cash flow is:
a. $240
b. $160
c. $80
d. $400
2. If the 2-year discount factor is 0.64, what is the rate of interest (in APR)?
a. 10%
b. 25%
c. 40%
d. None of the above
3. What is the present value of the following cash flow at a discount rate of 9%?
a. $372,431.81
b. $450,000
c. $405,950.68
d. None of the above
4. At an interest rate of 10%, which of the following cash flows should you prefer?
Year 1 Year 2 Year 3
a. 500 300 100
b. 100 300 500
c. 300 300 300
d. Any of the above as they all add up to $900
- 10 years ago
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