Assignment 01 (Mohammed Hamad Al Mazroui) - UNIVERSITY OF...

UNIVERSITY OF MODERN SCIENCE 2015
BUSINESS FINANCE
(FINA 321)
Assignment: 01
(FALL Semester 2015-16)
Page 1
INSTRUCTOR NAME : Dr. Suchi Dubey
STUDENT NAME : Mohammed Hamad Al Mazrouei
STUDENT ID : 20131496
SECTION : 03

UNIVERSITY OF MODERN SCIENCE 2015
Section
A
Objective Type Question
1. If firm receives a cash flow from an investment that will increase by 10 percent annually for an infinite number of
years. This cash flow stream is called
a. an annuity due.
b. a growing perpetuity.
c. an ordinary annuity.
d. a growing annuity.
2. Trevor Smith wants to have a million dollars at retirement, which is 15 years away. He already has $200,000 in an IRA
earning 8 percent annually. How much does he need to save each year, beginning at the end of this year to reach his
target? Assume he could earn 8 percent on any investment he makes. (Round to the nearest dollar.)
3. If you were to compare the returns of an individual stock to a market index, select the answer below that is most true.
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UNIVERSITY OF MODERN SCIENCE 2015