Corporate Finance Trivia Quiz! MCQ

9 Questions | Total Attempts: 102

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Corporate Finance Trivia Quiz! MCQ - Quiz

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Questions and Answers
  • 1. 
    What is the principal amount of a bond that is repaid at the end of the loan term called?
    • A. 

      Face Value

    • B. 

      Coupon

    • C. 

      Accrued Price

    • D. 

      Dirty Price

    • E. 

      Market Price

  • 2. 
    The value of an investment after one or more times periods is called the:
    • A. 

      Present Value

    • B. 

      Discount rate

    • C. 

      Future Value

    • D. 

      Compounding

  • 3. 
    Compound interest is defined as the interest earned.
    • A. 

      Only on the initial investment

    • B. 

      On both the initial principal and all interest earned and reinvested in prior periods

    • C. 

      Timing of the annuity payments

  • 4. 
    By definition, a bank that pays simple interest on a savings account will pay interest.
    • A. 

      Only on the initial investment

    • B. 

      Only at the beginning of the investment period

  • 5. 
    The process of adding the interest earned on investment to the original investment in order to earn more interest is calling.
    • A. 

      Discounting

    • B. 

      Compounding

    • C. 

      Future Value

  • 6. 
    Which one of the following is the correct formula for the future value of a lump sum invested today?
    • A. 

      FV =PV/(1+r)t

    • B. 

      Fv=PV x(1+r)t

    • C. 

      PV=FV/(1+r)t

  • 7. 
    The current value of future cash flows discounted at the appropriate discount rate is called:
    • A. 

      Future value

    • B. 

      Present value

    • C. 

      Discount rate

  • 8. 
    The interest rate used to compute the present value of a future cash flow is called:
    • A. 

      Discount rate

    • B. 

      Future value

    • C. 

      Present value

    • D. 

      Discounting

  • 9. 
    Which one of the following is the correct formula for computing the present value of a lump sum to be received sometime in the future.
    • A. 

      Fv=pv/(1+r)t

    • B. 

      Pv=fv/(1+r)t

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