Quiz 1 - Mat 540 Essay Example
* Question 1
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | If CF0 is positive and all the other CFs are negative, then you can still solve for I. | Correct Answer: | If CF0 is positive and all the other CFs are negative, then you can still solve for I. | | | | | * Question 2
2 out of 2 points | | | You plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows. Which of the following would lower the calculated value of the investment?Answer | | | | | Selected Answer: | The discount rate increases. | Correct Answer: | The discount rate increases. | | | | | * Question 3
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | Time lines can be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. | Correct Answer: | Time lines can be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. | | | | | * Question 4
2 out of 2 points | | | Which of the following investments would have the highest future value at the end of 10 years? Assume that the effective annual rate for all investments is the same and is greater than zero.Answer | | | | | Selected Answer: | Investment A pays $250 at the beginning of every year for the next 10 years (a total of 10 payments). | Correct Answer: | Investment A pays $250 at the beginning of every year for the next 10 years (a total of 10 payments). | | | | | * Question 5
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | The cash flows for an annuity due must all occur at the beginning of the periods. | Correct Answer: | The cash flows for an annuity
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | If CF0 is positive and all the other CFs are negative, then you can still solve for I. | Correct Answer: | If CF0 is positive and all the other CFs are negative, then you can still solve for I. | | | | | * Question 2
2 out of 2 points | | | You plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows. Which of the following would lower the calculated value of the investment?Answer | | | | | Selected Answer: | The discount rate increases. | Correct Answer: | The discount rate increases. | | | | | * Question 3
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | Time lines can be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. | Correct Answer: | Time lines can be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. | | | | | * Question 4
2 out of 2 points | | | Which of the following investments would have the highest future value at the end of 10 years? Assume that the effective annual rate for all investments is the same and is greater than zero.Answer | | | | | Selected Answer: | Investment A pays $250 at the beginning of every year for the next 10 years (a total of 10 payments). | Correct Answer: | Investment A pays $250 at the beginning of every year for the next 10 years (a total of 10 payments). | | | | | * Question 5
2 out of 2 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | The cash flows for an annuity due must all occur at the beginning of the periods. | Correct Answer: | The cash flows for an annuity