15/20 that's 75%. All Correct answers are in yellow
RETAKE THIS PRACTICE MILESTONE
15 questions were answered correctly.
5 questions were answered incorrectly.
1
You loan a friend $1,500 for one year and with an interest rate of 4%.
What is the value of your $1,500 when your friend pays you back?
$1,560
$2,100
$1,440
$1,520
CONCEPT
Future Value, Single Cash Flows
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2
Which of the following is an advantage of bonds for a potential investor?
They provide a more consistent and reliable income stream than stocks.
They are not subject to any form of risk.
Bond prices are set by the indenture and cannot fall.
A bondholder can "call" the bond and demand final payment early.
CONCEPT
Advantages and Disadvantages of Bonds
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3
How do common stock and preferred stock differ?
Unlike common stock, preferred stock is considered to be risk-free.
Unlike preferred stock, common stock can command dividends.
Unlike common stock, preferred stock comes with preemptive rights.
Unlike common stock, preferred stock is rated by credit rating agencies.
, CONCEPT
Types of Stock
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4
What is the present value of a $50,000 payment you will receive in one year, assuming a
discount rate of 5%?
$47,619
$48,765
$39,176
$47,573
CONCEPT
Present Value, Single Cash Flows
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5
Kean receives $200 today.
According to the time value of money, the $200 he has today is worth __________ the $200
that he could receive next year.
more than
twice as much as
less than
the same as
CONCEPT
Introduction to the Time Value of Money
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6
Select one advantage of an annuity for a borrower.
It is typically easier to repay a loan as a single lump sum.
It offers predictable and regular payments for the life of the annuity.
It is repaid more quickly than other types of loans.
Annuities always have lower interest rates than regular loans.
RETAKE THIS PRACTICE MILESTONE
15 questions were answered correctly.
5 questions were answered incorrectly.
1
You loan a friend $1,500 for one year and with an interest rate of 4%.
What is the value of your $1,500 when your friend pays you back?
$1,560
$2,100
$1,440
$1,520
CONCEPT
Future Value, Single Cash Flows
Report an issue with this question
2
Which of the following is an advantage of bonds for a potential investor?
They provide a more consistent and reliable income stream than stocks.
They are not subject to any form of risk.
Bond prices are set by the indenture and cannot fall.
A bondholder can "call" the bond and demand final payment early.
CONCEPT
Advantages and Disadvantages of Bonds
Report an issue with this question
3
How do common stock and preferred stock differ?
Unlike common stock, preferred stock is considered to be risk-free.
Unlike preferred stock, common stock can command dividends.
Unlike common stock, preferred stock comes with preemptive rights.
Unlike common stock, preferred stock is rated by credit rating agencies.
, CONCEPT
Types of Stock
Report an issue with this question
4
What is the present value of a $50,000 payment you will receive in one year, assuming a
discount rate of 5%?
$47,619
$48,765
$39,176
$47,573
CONCEPT
Present Value, Single Cash Flows
Report an issue with this question
5
Kean receives $200 today.
According to the time value of money, the $200 he has today is worth __________ the $200
that he could receive next year.
more than
twice as much as
less than
the same as
CONCEPT
Introduction to the Time Value of Money
Report an issue with this question
6
Select one advantage of an annuity for a borrower.
It is typically easier to repay a loan as a single lump sum.
It offers predictable and regular payments for the life of the annuity.
It is repaid more quickly than other types of loans.
Annuities always have lower interest rates than regular loans.
