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Unformatted text preview: Sheet1 Page 1 Which of the following is true? a. The present value of an annuity due is worth more than the present value of a regular annuity, all other things the same. b. The future value of an annuity due is worth more than the future value of a regular annuity, all other things the same. c. If you need to accumulate a set amount of money at the end of a set period of time, then it is better to make the investmen d. All of the above are true. status: not answered () correct: d your answer:  2 You are going to receive $80 at the beginning of each year for the next 12 years. If you invest each of those amounts at 12% a. $218.40 b. $1,075.20 c. $2,162.33 d. $2,909.00 status: not answered () correct: c your answer:  3 You need $150 today and are willing to sell $265.73 that you expect to receive 6 years from now. At what discount rate will a. 71.53% b. 30.97% c. 14.44% d. 10.00% status: not answered () correct: d your answer:  4 You will receive $10 one year from now and that amount will increase each year by 5% forever. If the proper discount rate fo a. $125.00 b. $200.00 Sheet1 Page 2 c. $333.33 d. $1000.00 status: not answered () correct: c your answer:  5 If you can invest funds at a 5% simple annual interest rate then how long will it take to double your money? a. 5 years b. 7 years c. 10 years d. 20 years status: not answered () correct: d your answer:  6 You plan to invest $300 for 3 years at 7% simple interest. What is the total value of the investment at the end of 3 years? a. $321.00 b. $363.00 c. $367.51 d. none of the above status: not answered () correct: b your answer:  7 You are going to receive $80 at the beginning of each year for the next 12 years. If the proper discount rate for each of thos a. $218.40 b. $275.98 c. $555.02 d. $1,075.2 Sheet1 Page 3 status: not answered () correct: c your answer:  8 You need $150 today and are willing to sell a portion of a very large cash flow that you expect to receive 6 years from now. 8 You need $150 today and are willing to sell a portion of a very large cash flow that you expect to receive 6 years from now....
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This note was uploaded on 08/26/2011 for the course ECON 515 taught by Professor John during the Spring '11 term at American University of Kuwait.
 Spring '11
 John

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