FRL 300 Common Exam Topics

FRL 300 Common Exam Topics - FRL 300 Common Exam Topics...

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1 FRL 300 Common Exam Topics Coverage: Chapter 5-6-7-8-9-10 Chapter 5: Time Value of Money 1. Define and compute simple vs. compound Interest 2. Future value and compounding Compute the future (compound) value of a lump sum investment 3. Present value and discounting: Compute the present value of a lump sum investment 4. Compute the interest rate (rate of return) that is implied by the value change 5. Compute the number of periods required to attain a desired amount of money from a fixed investment amount Chapter 6: Multi-Period Cash Flows and Discounted Cash Flow Analysis 1. Compute the future value of multiple cash flows 2. Compute the present value of multiple cash flows 3. Define annuity (and annuity due) and perpetuity An ordinary annuity versus an annuity due A perpetuity as a special case of an annuity 4. Calculate annuity and perpetuity values Calculate present value and future values for ordinary annuity Calculate the present value of a level perpetuity Solve for the implied interest rates in a series of annuity cash flows Solve for an annuity payment Solve for the number of payments required to payoff a loan 5. The concepts of the effective annual rate (EAR) and the annual percentage rate (APR) Calculate the APR given the EAR
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FRL 300 Common Exam Topics - FRL 300 Common Exam Topics...

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