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- The Role and Objective of Financial ManagementThe Domestic and International Financial MarketplaceEvaluation of Financial PerformanceFinancial Planning and ForecastingThe Time Value of MoneyFixed Income Securities: Characteristics and ValuationCommon Stock: Characteristics, Valuation, and IssuanceAnalysis of Risk and ReturnCapital Budgeting and Cash Flow AnalysisCapital Budgeting: Decision Criteria and Real Option ConsiderationsCapital Budgeting and RiskThe Cost of CapitalCapital Structure ConceptsCapital Structure Management in PracticeDividend PolicyWorking Capital Policy and Short-term FinancingThe Management of Cash and Marketable SecuritiesManagement of Accounts Receivable and InventoriesLease and Intermediate-term FinancingFinancing With DerivativesRisk ManagementInternational Financial ManagementCorporate RestructuringAppendix: Continuous Compounding and DiscountingAppendix: Mutually Exclusive Investments Having Unequal LivesAppendix: Breakeven AnalysisAppendix: Bond Refunding AnalysisAppendix: Taxes

Question 1

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(1 + rate per time period), the number of time periods

(1 + rate per time period), (the number of time periods -1)

rate per time period, the number of time periods

rate per time period, (the number of time periods - 1)

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Question 2

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PV0 = FVn(PVIFi,n)

PV0 = FVn(PVIFAi,n)

PV0 = FVn[1/(1 + i)n]

a and c

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Question 3

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FVn = PV0(PVIFi,n)

FVn = PV0(FVIFAi,n)

FVn = PV0(1/(1+ i)n)

FVn = PV0(FVIFi,n)

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Question 4

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annualizing

compounding

discounting

leasing

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Question 5

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dividing, (1 + i)

dividing, (1 + i)n

multiplying, (1 + i)

multiplying, (1 + i)n

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Question 6

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annuity

annuity due

sinking fund

perpetuity

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Question 7

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future value of an annuity

future value of an annuity due

present value of an annuity

present value of an annuity due

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Question 8

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future value of an annuity

present value of an annuity

future value of an annuity due

present value of an annuity due

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Question 9

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payments are assumed to be made at the beginning of each period

PVIFA factors decrease with an increase in the interest rate

PVIFA factors increase with an increase in the number of periods

b and c only

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Question 10

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payments are assumed to be made at the end of each period

FVIFA factors increase with an increase in the interest rate

FVIFA factors increase with an increase in the number of periods

all of the above

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Question 11

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payments or receipts occur at the end of each period.

payments or receipts occur at the beginning of each period.

payments or receipts occur forever.

cash flows occur continuously.

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Question 12

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it will be worth less

it will be worth more

it will not change

it will increase during the first ten years

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Question 13

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extend the cash flows over a longer period of time

increase the discount rate

decrease the discount rate

extend the cash flows over a longer period of time, and decrease the discount rate

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Question 14

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the discount rate must be very high

there is no inflation

the discount rate must be zero

none of the answers is correct

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Question 15

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9 years

7 years

8 years

10 years

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Question 16

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sum of the present value of a series of equal periodic payments

future value of an equal series of payments

receipt of equal cash flows for a specified amount of time

sum of the future value of an equal series of payments

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Question 17

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rate of interest is reduced each year

amount of interest paid is reduced each year

payment is reduced each year

balance is paid as a balloon payment in the fifth year

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Question 18

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term loans

lease contracts

capital investments

capital recovery problems

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Question 19

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greater the present value

greater the amount deposited

greater the effective interest rate

lesser the future value

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Question 20

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greater than

equal to

less than

equal to or greater than

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