Finance 303

In almost all multiple cash flow calculations, it is implicitly assumed that the cash flows occur at the _____ of each period.

End

The annuity present value factor equals one____________the present value factor all divided by the discount rate.

Minus

You are solving a present value equation using a financial calculator and are given the number of years for compounding. This should be entered as the _____ value on the financial calculator.

N

The formula for the ______ value interest factor of an annuity is: [1- 1/(1+r)τ]/r.

Present

True or false: To find the future value of multiple cash flows, calculate the future value of each cash flow first and then sum them.

True

When finding the present or future value of an annuity using a financial calculator, the ______ ______ should be entered as a percentage. interest rate payment inflation rate future value

interest rate

An ordinary annuity consists of a(n) ________ stream of cash flows for a fixed period of time.

level

Which of the following processes can be used to calculate the future value of multiple cash flows?

Compound the accumulated balance forward one year at a time

The first cash flow at the end of Week 1 is $100, the second cash flow at the end of Month 2 is $100, and the third cash flow at the end of Year 3 is $100. This cash flow pattern is a(n) ______ type of cash flow.

Uneven