quiz questions - money to be received in the future? A. A...

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1) Commercial paper that is sold without the use of an actual paper certificate is known as A. finance paper. B. term paper. C. book-entry paper. D. dealer paper. 2) Firms exposed to the risk of interest rate changes may reduce that risk by 3) A firm has invested in corporate bonds; it may engage in a financial futures contract in order to protect itself from A. declining interest rates. B. changes in hedging activities. C. inflation. D. rising interest rates. 4) Commercial paper is very popular with many firms because A. it can usually be issued below the prime rate. B. it is very easy to roll over ( refinance ) in times of economic turmoil. C. there are no required lines of credits at the bank. D. it satisfies the firm's need for long-term funds. 5) Under what conditions must a distinction be made between money to be received today and
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Unformatted text preview: money to be received in the future? A. A period of recession. B. When current interest rates are different from expected future rates. C. When there is no risk of nonpayment in the future. D. When idle money can earn a positive return. 6) As the time period until receipt increases, the present value of an amount at a fixed interest rate 7) Mr. Nailor invests $5,000 in a money market account at his local bank. He receives annual interest of 8% for 7 years. How much return will his investment earn during this time period? A. $2,915 B. $8,570 C. $6,254 D. $3,570 8) You are to receive $12,000 at the end of 5 years. The available yield on investments is 6%. Which table would you use to determine the value of that sum today?...
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quiz questions - money to be received in the future? A. A...

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