Create simple examples to illustrate the following concepts. i. Time value of money ii. Effective interest iii. Sinking Fund iv. Amortized loan
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Create simple examples to illustrate the following concepts.
i. Time value of money
ii. Effective interest
iii. Sinking Fund
iv. Amortized loan
Step by step
Solved in 2 steps
- Define the term loan cash flow?Estimating liquidity needs involves:A. forecasting the level of future loan commitments and depositsB. establishing a liquidity budgetC. forecasting interest rate levelsD. a and cThe yield on a savings account is also referred to as Select one: of O A. liquidity. O B. compounding. zion O C. rate of return. O D. asset management. O E. insolvency.
- A ‘surplus unit’ is also known as a: Select one: a. debtors b. demander of funds c. lender d. borrowerWhat do you understand by the present value of money? Group of answer choices A. Amount borrowed or deposited B. Maximum that can be deposited C. Sum of deposit and interest D. Another name for the futureWhat is the loan cash flow?
- What is Repayment cash flow?Which of the following methods consider the time value of money? A. payback and accounting rate of return B. payback and internal rate of return C. internal rate of return and accounting rate of return D. internal rate of return and net present valueDefine cost of borrowing.