Future Value Present Value Table Factor Interest Rate 96

Q: Compare and contrast dollar returns and rates of return.

A: The returns from any investment can be calculated in terms of value (amount terms) or percentages.

Q: Explain quoted interest rate

A: Quoted interest rate: It is other ways known as nominal interest rate or annual percentage rate and…

Q: The present value of a lump sum future amount: O A. increases as the interest rate decreases. O B.…

A: The present value is defined as the discounted amount of the expected future value. The current…

Q: How do you calculate inflation premium

A: Inflation refers to the sustained increase in the general level of prices of goods and services in…

Q: Effective interest amortization method uses which of the following rates to determine interest…

A: Under the effective interest method, the interest is calculated as yield to maturity multiplied by…

Q: Formula for interest rate parity?

A: Interest Rate Parity: It is the technique used to govern the relation between currency exchange rate…

Q: The formula in getting the compound interest given the present value and maturity value is…

A: Compound interest : Compound interest can be understood as the transfer of interest, or, in specific…

Q: How is discounting used in the context of present values and future values? O To reduce a present…

A: Present amount and future amount are two terms which are widely used in time-factor of money where…

Q: Which option is an efficiency ratio? Select an answer: total asset turnover ratio

A: Ratio analysis is one of the technique used in management accounting. Several type of calculations…

Q: 5. How the time based term effects interest rates and its yield curve?

A: Yield curve:- A yield curve is a graph that shows how the yields (interest rates) of bonds with…

Q: Which of the following best describes the constant-growth dividend discount model? a. It is the…

A: Constant-Growth Dividend Discount Model: Growth that is unabated The Dividend Discount Model, often…

Q: 3. Future value The principal of the time value of money is probably the single most important…

A: Time value of money: This concept tells us that a sum of money received today is  worth more than a…

Q: What is the rela1ionship between Annual  Percentage Rate and the interest period?

A: Answer: Annual percentage rate represents the interest rate which also takes additional payments…

Q: Explain Interest Rates and Inflation Expectation?

A: An interest rate is the measure of cash a bank or creditor charges for right of entry to cash. The…

Q: Give me the formula of net present value

A: Net Present Value of a project is equivalent to the difference between the present value of cash…

Q: 1)What is '''effective annual interest rate"? 2) Explain it by numerical examples

A: There are two types of interest rate Nominal Interest Rate and Effective Interest Rate The effective…

Q: Explain APY (annual percentage yield)?

A: APY (Annual Percentage Yield):   It is the real return rate that is earned on an investment during a…

Q: The discount rate is the combination of what two types of discounting?   a. exponential and linear…

A: Discount rates are used for discounting the future cash flows. It helps in determining the time…

Q: What security provides a good estimate of the long-term nominalrisk-free rate?

A: Risk-free Rate is the estimation of the rate that is earned on the securities or the investments…

Q: What is Annual-payments option?

A: The annual payment option is the obligation to pay the amount to the receiver annual instead of the…

Q: What is the concept of present value? How does it affect inflation

A: Increase in general price levels in an economy is known as inflation. Due to inflation, the cost of…

Q: Assume that the variables I, N, and PV represent the interest rate, investment or deposit period,…

A: Compound interest formula: Future value = Present value *(1+rate)^years. Answer: FV = PV x (1 + I)NN

Q: Ayield curve states that the long-term interest rate is higher than the short-term interest rates.

A: A Yield Curve, also commonly referred to as "The Term Structure of Interest Rates", depicts the…

Q: Monthly interest rate?

A: Monthly interest rate is the interest charged on the unpaid balance of credit card.

Q: When is a project in Need for an External Interest Rate?

A: When net cash flow that is generated by the project during the project’s life is reinvested, then…

Q: impacts  of inflation on money investment

A: Inflation occurs when prices across a sector or an industry increases, thereby decreasing the…

Q: present

A: Formula to calculate the payments is: Present value of annuity: Annuity[1-(1+interest rate)^-time…

Q: What do we call the process of finding future value? Discounting Compounding Discount interest…

A: This is based on the concept of time value of money.   Amount put aside today or invested today…

Q: What is an “equivalent annual annuity (EAA)”? When and how are EAAs used in capital budgeting?

A:

Q: The real rate of return is related to O The risk-free rate The risk-free and the inflation rate The…

A: Real rate of returnAn annual profit percentage that is earned on the investment, being adjusted for…

Q: Explain the prime interest rate.

A: Interest are generally charged on the loans. Borrowers are needed to pay the interest to the person…

Q: Why inflation is considered and have effect in present value?

A: Inflation is the increase in the general price level of the country. It is an important indicator of…

Q: What do we call the process of finding present value? discounting compounding discount interest…

A: The current worth of any sum is regarded as its present value. Any sum's accumulated worth in the…

Q: Annuity Present Value Inputs Payment Discount Rate/Period Number of Periods Present Value using a…

A: Present value of annuity is the present value of all the stream of cash flows that occur in future.…