Ch5 - COURSES > FUNDAMENTALS OF CORPORATE FINANCE:, 9/E-...

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Add, modify, and remove questions. Select a question type from the Add Question drop-down list and click Go to add questions. Use Creation Settings to establish which default options, such as feedback and images, are available for question creation. COURSES > FUNDAMENTALS OF CORPORATE FINANCE:, 9/E - ROSS > CONTROL PANEL > POOL MANAGER > POOL CANVAS Pool Canvas Add Multiple Choice Creation Settings Name Chapter 05 Introduction to Valuation: The Time Value of Money Description Questions which Blackboard's assessment component is incapable of supporting are not included in the export. Instructions Add Question Here Question 1 Multiple Choice Question You are investing $100 today in a savings account at your local bank. Which one of the following terms refers to the value of this investment one year from now? Answer future value present value principal amount discounted value invested principal Correct Feedback Refer to section 5.1 Incorrect Feedback Refer to section 5.1 Add Question Here Question 2 Multiple Choice Question Tracy invested $1,000 five years ago and earns 4 percent interest on her investment. By leaving her interest earnings in her account, she increases the amount of interest she earns each year. The way she is handling her interest income is referred to as which one of the following? Answer simplifying compounding aggregation accumulation discounting Correct Feedback Refer to section 5.1 Incorrect Feedback Refer to section 5.1 Add Question Here Question 3 Multiple Choice
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Steve invested $100 two years ago at 10 percent interest. The first year, he earned $10 interest on his $100 investment. He reinvested the $10. The second year, he earned $11 interest on his $110 investment. The extra $1 he earned in interest the second year is referred to as: Answer free interest. bonus income. simple interest. interest on interest. present value interest. Correct Feedback Refer to section 5.1 Incorrect Feedback Refer to section 5.1 Add Question Here Question 4 Multiple Choice Question Interest earned on both the initial principal and the interest reinvested from prior periods is called: Answer free interest. dual interest. simple interest. interest on interest. compound interest. Correct Feedback Refer to section 5.1 Incorrect Feedback Refer to section 5.1 Add Question Here Question 5 Multiple Choice Question Sara invested $500 six years ago at 5 percent interest. She spends her earnings as soon as she earns any interest so she only receives interest on her initial $500 investment. Which type of interest is Sara earning? Answer free interest complex interest simple interest interest on interest compound interest Correct Feedback Refer to section 5.1 Incorrect Feedback Refer to section 5.1 Add Question Here Question 6 Multiple Choice Question Shelley won a lottery and will receive $1,000 a year for the next ten years. The value of her winnings today discounted at her discount rate is called which one of the following? Answer
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This note was uploaded on 06/22/2010 for the course FIN 600 taught by Professor Marks during the Spring '10 term at Odessa College.

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Ch5 - COURSES > FUNDAMENTALS OF CORPORATE FINANCE:, 9/E-...

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