fin320r1week3selfassesmentquestions

fin320r1week3selfassesmentquestions - e. Simple interest 5....

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FIN/320 Self-Assessment Questions Week Three : TVM and Capital Structure 1. An annuity is an uneven stream of cash flows for an undetermined period of time. True False 2. Dividends are payments by a corporation to shareholders. True False 3. A firm’s WACC is the weighted average of the cost of equity and the before tax cost of debt. True False 4. Interest earned only on the beginning principal amount of an investment is______________ a. Compounding b. Interest on interest c. Compound interest d. Reflective interest
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Unformatted text preview: e. Simple interest 5. What is the future value of $100.00 invested for one year at a 5% annual interest rate? a. $100.05 b. $100.50 c. $105.00 d. $115.00 e. $150.00 6. What is the stated interest payment made on a bond? a. Face value b. Coupon c. Maturity date d. YTM rate e. Face value 7. The ___________________ is the return that a companys lenders require on new debt. a. Cost of debt b. Par value c. Net present value d. Interest rate e. None of the above...
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