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AGEC 330 EXAM 1(FULL TEST) || 2025 ACTUAL
EXAM ALL QUESTIONS AND 100% CORRECT
ANSWERS GRADE A+|| LATEST AND COMPLETE
UPDATED VERSION 2025|| GUARANTEED PASS!!!
The life cycle effect uses information about past, present, and expected business
performance comes in part from a financial accounting system that reports the
firm's profitability, liquidity, and solvency positions. ANSWER- F
The theory of finance is the concern with how individuals and firms allocate
resources through time ANSWER- T
Accounting tools consist of the balance sheet, income statement, and cash flow
statement. ANSWER- T
Accounting methods are used to evaluate the future directions of a firm
ANSWER- F
Low asset liquidity is one of the structural characteristics of the agricultural
production sector ANSWER- T
If you can earn 12% on your money, how much should you pay today for an
investment that promises to pay $150 in one year (Market Value)? ANSWER-
$133.93
The Market Value of any contract is the present value of the remaining payments
discounted at the market rate. ANSWER- T
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What is the yield on an investment that costs $110, and promises to pay $115 in
one year? ANSWER- 4.5%
r= (115-110)/110
What is the yield on an investment that costs $125, and promises to pay $275 in
three years? ANSWER- 30.06%
(finance calc)
The Net Present Value is an investments profit over the required return to capital
ANSWER- T
Yield is calculated as the discount rate that makes the present value of cash inflows
equal to the present value of cash outflows. ANSWER- T
What is the NPV of an investment that costs $150, promises to pay $350 in three
years, and the rate of return on comparable investments is 12% ANSWER-
$99.12
The book value of a contract is the future payments of any contract discounted at
the contractual rate. ANSWER- T
In the context of profitability, an investment is acceptable if the Net Present Value
is greater than zero. ANSWER- T
The market value of a contract is the future value of the remaining payments of a
contract compounded at the market rate ANSWER- F
,3|Page
What is the NPV of an investment that costs $95, promises to pay $125 in one
year, and the rate of return on comparable investments is 8%. ANSWER- $20.74
(125(1.08)^-1)-95
If you invest $175 and earn a rate of return of 11%, how much money will you
have in 1 years? ANSWER- $194.25
What is the rate of return on an investment that costs $225 and promises to return
$275 in one years? ANSWER- 22.22%
r=275-225/225
If you invest $200 and earn a rate of return of 10%, how much money will you
have in 1 years? ANSWER- $220
If you invest $150 and earn a rate of return of 12%, how much money will you
have in 1 year? ANSWER- $168
If you can earn 10% on your money, how much should you pay today for an
investment that promises to pay $175 in two years (Market Value)? ANSWER-
$144.63
The yield on an investment is always equal to the discount rate used to calculate
the NPV ANSWER- F
The Net Present Value represents the investment profit over a zero rate of return on
capital. ANSWER- F
, 4|Page
What is the NPV of an investment that costs $175, promises to pay $250 in two
years, and the rate of return on comparable investments is 10%. ANSWER-
$31.61
Consider a bond with a Par Value of $1,000. It pays a coupon of 12% and the
coupon is paid annually. It matures in 10 years. Calculate the market value of the
bond if the market rate is 10%. ANSWER- $1122.89
Consider a bond with a Par Value of $1,125. It pays a coupon of 8% and the
coupon is paid monthly. It matures in 8 years. The market rate is 10%. Calculate
the book value of the bond. ANSWER- $1125
Identification of investment opportunities is a crucial function of management.
ANSWER- T
Suppose that the firm Aggie Alfalfa has a hay field that they are willing to sell
today. The net annual returns to the hay ield are expected to be $35,000 per year
for the next 15 years. At the end of 15 years, it is expected that the land will sell for
$25,000. Calculate the Market Value of the orchard if the market rate of return on
comparable investments is 14% ANSWER- $218,478
Financing refers to the means of acquiring control of assets: ownership by cash
purchase or borrowing or leasing. ANSWER- T
The price of a bond goes down as interest rates go down. ANSWER- F
The price of bond and the interest rate are inversely related ANSWER- T
AGEC 330 EXAM 1(FULL TEST) || 2025 ACTUAL
EXAM ALL QUESTIONS AND 100% CORRECT
ANSWERS GRADE A+|| LATEST AND COMPLETE
UPDATED VERSION 2025|| GUARANTEED PASS!!!
The life cycle effect uses information about past, present, and expected business
performance comes in part from a financial accounting system that reports the
firm's profitability, liquidity, and solvency positions. ANSWER- F
The theory of finance is the concern with how individuals and firms allocate
resources through time ANSWER- T
Accounting tools consist of the balance sheet, income statement, and cash flow
statement. ANSWER- T
Accounting methods are used to evaluate the future directions of a firm
ANSWER- F
Low asset liquidity is one of the structural characteristics of the agricultural
production sector ANSWER- T
If you can earn 12% on your money, how much should you pay today for an
investment that promises to pay $150 in one year (Market Value)? ANSWER-
$133.93
The Market Value of any contract is the present value of the remaining payments
discounted at the market rate. ANSWER- T
,2|Page
What is the yield on an investment that costs $110, and promises to pay $115 in
one year? ANSWER- 4.5%
r= (115-110)/110
What is the yield on an investment that costs $125, and promises to pay $275 in
three years? ANSWER- 30.06%
(finance calc)
The Net Present Value is an investments profit over the required return to capital
ANSWER- T
Yield is calculated as the discount rate that makes the present value of cash inflows
equal to the present value of cash outflows. ANSWER- T
What is the NPV of an investment that costs $150, promises to pay $350 in three
years, and the rate of return on comparable investments is 12% ANSWER-
$99.12
The book value of a contract is the future payments of any contract discounted at
the contractual rate. ANSWER- T
In the context of profitability, an investment is acceptable if the Net Present Value
is greater than zero. ANSWER- T
The market value of a contract is the future value of the remaining payments of a
contract compounded at the market rate ANSWER- F
,3|Page
What is the NPV of an investment that costs $95, promises to pay $125 in one
year, and the rate of return on comparable investments is 8%. ANSWER- $20.74
(125(1.08)^-1)-95
If you invest $175 and earn a rate of return of 11%, how much money will you
have in 1 years? ANSWER- $194.25
What is the rate of return on an investment that costs $225 and promises to return
$275 in one years? ANSWER- 22.22%
r=275-225/225
If you invest $200 and earn a rate of return of 10%, how much money will you
have in 1 years? ANSWER- $220
If you invest $150 and earn a rate of return of 12%, how much money will you
have in 1 year? ANSWER- $168
If you can earn 10% on your money, how much should you pay today for an
investment that promises to pay $175 in two years (Market Value)? ANSWER-
$144.63
The yield on an investment is always equal to the discount rate used to calculate
the NPV ANSWER- F
The Net Present Value represents the investment profit over a zero rate of return on
capital. ANSWER- F
, 4|Page
What is the NPV of an investment that costs $175, promises to pay $250 in two
years, and the rate of return on comparable investments is 10%. ANSWER-
$31.61
Consider a bond with a Par Value of $1,000. It pays a coupon of 12% and the
coupon is paid annually. It matures in 10 years. Calculate the market value of the
bond if the market rate is 10%. ANSWER- $1122.89
Consider a bond with a Par Value of $1,125. It pays a coupon of 8% and the
coupon is paid monthly. It matures in 8 years. The market rate is 10%. Calculate
the book value of the bond. ANSWER- $1125
Identification of investment opportunities is a crucial function of management.
ANSWER- T
Suppose that the firm Aggie Alfalfa has a hay field that they are willing to sell
today. The net annual returns to the hay ield are expected to be $35,000 per year
for the next 15 years. At the end of 15 years, it is expected that the land will sell for
$25,000. Calculate the Market Value of the orchard if the market rate of return on
comparable investments is 14% ANSWER- $218,478
Financing refers to the means of acquiring control of assets: ownership by cash
purchase or borrowing or leasing. ANSWER- T
The price of a bond goes down as interest rates go down. ANSWER- F
The price of bond and the interest rate are inversely related ANSWER- T
