1.
value:
10.00 points
The present value of $100 expected two years from today at a discount rate of 6 percent is
$112.36.
$106.00.
$100.00.
$89.00.
2.
value:
10.00 points
Present value is defined as
future cash flows discounted to the present by an appropriate discount rate.
inverse of future cash flows.
present cash flows compounded into the future.
future cash flows multiplied by the factor (1 + r)t.
3.
value:
10.00 points
If the annual interest rate is 12 percent, what is the two-year discount factor?
0.7972
0.8929
1.2544
0.8065
4.
Award: 10 out of 10.00 points
If the present value of cash flow X is $240 and the present value of cash flow Y is $160, then the
present value of the combined cash flows is
$240.
$160.
$80.
$400.
PV (x + y) = PV (x) + PV (y) = 240 + 160 = 400.
,5.
Award: 10 out of 10.00 points
The rate of return is also called the
discount rate only.
discount rate and hurdle rate only.
discount rate, hurdle rate, and opportunity cost of capital.
discount rate and opportunity cost of capital only.
6.
Award: 10 out of 10.00 points
The present value of $121,000 expected one year from today at an interest rate (discount rate) of 10
percent per year is
$121,000.
$100,000.
$110,000.
$108,900.
PV = (121,000)/(1.10) = 110,000.
7.
Award: 10 out of 10.00 points
The one-year discount factor, at a discount rate of 25 percent per year, is
1.25.
1.0.
0.8.
0.75.
Discount factor = 1/1.25 = 0.8.
8.
Award: 10 out of 10.00 points
The one-year discount factor, at an interest rate of 100 percent per year, is
1.50.
0.50.
0.25.
1.00.
Discount factor = 1/(1 + 1.00) = 0.5.
, 9.
Award: 10 out of 10.00 points
The present value of $100,000 expected at the end of one year, at a discount rate of 25 percent per
year, is
$80,000.
$125,000.
$100,000.
$75,000.
PV = (100,000)/(1 + 0.25) = 80,000.
10.
Award: 10 out of 10.00 points
If the one-year discount factor is 0.8333, what is the discount rate (interest rate) per year?
10 percent
20 percent
30 percent
40 percent
DF = 1/(1 + r)^1 = 0.8333; 1 + r = 1/0.8333; r = 20%.
11.
Award: 10 out of 10.00 points
If the present value of $480 to be paid at the end of one year is $400, what is the one-year discount
factor?
0.8333
1.20
0.20
1.00
Discount factor is = 400/480 = 0.8333.
12.
Award: 10 out of 10.00 points
If the present value of $250 expected one year from today is $200, what is the one-year discount
rate?
10 percent
20 percent
25 percent
30 percent
value:
10.00 points
The present value of $100 expected two years from today at a discount rate of 6 percent is
$112.36.
$106.00.
$100.00.
$89.00.
2.
value:
10.00 points
Present value is defined as
future cash flows discounted to the present by an appropriate discount rate.
inverse of future cash flows.
present cash flows compounded into the future.
future cash flows multiplied by the factor (1 + r)t.
3.
value:
10.00 points
If the annual interest rate is 12 percent, what is the two-year discount factor?
0.7972
0.8929
1.2544
0.8065
4.
Award: 10 out of 10.00 points
If the present value of cash flow X is $240 and the present value of cash flow Y is $160, then the
present value of the combined cash flows is
$240.
$160.
$80.
$400.
PV (x + y) = PV (x) + PV (y) = 240 + 160 = 400.
,5.
Award: 10 out of 10.00 points
The rate of return is also called the
discount rate only.
discount rate and hurdle rate only.
discount rate, hurdle rate, and opportunity cost of capital.
discount rate and opportunity cost of capital only.
6.
Award: 10 out of 10.00 points
The present value of $121,000 expected one year from today at an interest rate (discount rate) of 10
percent per year is
$121,000.
$100,000.
$110,000.
$108,900.
PV = (121,000)/(1.10) = 110,000.
7.
Award: 10 out of 10.00 points
The one-year discount factor, at a discount rate of 25 percent per year, is
1.25.
1.0.
0.8.
0.75.
Discount factor = 1/1.25 = 0.8.
8.
Award: 10 out of 10.00 points
The one-year discount factor, at an interest rate of 100 percent per year, is
1.50.
0.50.
0.25.
1.00.
Discount factor = 1/(1 + 1.00) = 0.5.
, 9.
Award: 10 out of 10.00 points
The present value of $100,000 expected at the end of one year, at a discount rate of 25 percent per
year, is
$80,000.
$125,000.
$100,000.
$75,000.
PV = (100,000)/(1 + 0.25) = 80,000.
10.
Award: 10 out of 10.00 points
If the one-year discount factor is 0.8333, what is the discount rate (interest rate) per year?
10 percent
20 percent
30 percent
40 percent
DF = 1/(1 + r)^1 = 0.8333; 1 + r = 1/0.8333; r = 20%.
11.
Award: 10 out of 10.00 points
If the present value of $480 to be paid at the end of one year is $400, what is the one-year discount
factor?
0.8333
1.20
0.20
1.00
Discount factor is = 400/480 = 0.8333.
12.
Award: 10 out of 10.00 points
If the present value of $250 expected one year from today is $200, what is the one-year discount
rate?
10 percent
20 percent
25 percent
30 percent
