兹维博迪金融学第二版试题库4TB1.docx

1、兹维博迪金融学第二版试题库4TB1兹维博迪金融学第二版试题库4TB(1) Chapter Four Allocating Resources Over TimeThis chapter contains 46 multiple-choice questions, 18 short problems and 9 longer problems.Multiple Choice1._ is the process of going from present value to future value, whereas _ is finding the present value of some fu

2、ture amount.(a)Discounting; compounding(b)Compounding; annualizing(c)Compounding; discounting(d)Discounting; leasingAnswer: (c)2._ refers to the interest rate at which money received before the end of the planning horizon can be reinvested.(a)Internal rate(b)Reinvestment rate(c)Cost of equity(d)Comp

3、ound interestAnswer: (b)3.The difference between an immediate annuity and an ordinary annuity is _.(a)the number of periods(b)the amount of the payments(c)the interest rate (d)the timing of the paymentsAnswer: (d)4.The preferred stock of Tavistock Realty offers a cash dividend of $2.28 per year and

4、it is selling at a price of $110 per share. What is the yield of Tavistock Realty preferred stock?(a)2.07%(b)2.12%(c)2.28%(d)48.25%Answer: (a)5.Consider the situation where you have won a $10 million lottery to be received in 25 annual equal payments of $400,000. What will happen to the present valu

5、e of these winnings if the interest rate increases during the next 25 years?(a)it will not change(b)it will be worth more(c)it will be worth less(d)it cannot be determinedAnswer: (c) 6.What is the effective annual rate on a bank account that has APR of 8 percent with interest compounded quarterly?(a

6、)6.12%(b)8.24%(c)8.48%(d)17.17%Answer: (b)7.You take out a loan with an APR of 10% with monthly compounding. What is the effective annual rate on your loan?(a)23.87%(b)21.6%(c)19.56%(d)18%Answer: (a)8.The CFO of CyberHelp Inc. has $250,000 in cash today that he wants to invest. How much will this in

7、vestment be worth in four years if the current interest rate is 8%(a)$270,000(b)$330,000(c)$340,125(d)$342,150Answer: (c)9.If you purchase a $12,000 certificate of deposit today with an APR of 14%, with quarterly compounding, what will the CD be worth when it matures in 5 years?(a)$20,846.99(b)$20,8

8、65.60(c)$23,104.97(d)$23,877.47Answer: (d)10.The CFO of CyberChain Inc. plans to unleash a media campaign that is expected to cost $15 million four years from today. How much cash should she set aside to pay for this if the current interest rate is 13%(a)$9.2 million(b)$13.3 million(c)$14.4 million(

9、d)$16.9 millionAnswer: (a)11.The NPV is a measure of how much your _ wealth changes as a result of your choice and if the NPV is _it does not pay to undertake that choice.(a)future; negative(b)current; negative(c)current; positive(d)future; positiveAnswer: (b)12.The _ is the rate that one can earn s

10、omewhere else if one did not invest in the project under evaluation.(a)opportunity cost of capital(b)cost of debt(c)cost of equity(d)weighted average cost of capitalAnswer: (a)13.You are trying to decide whether or not to buy a bond for $990 that will make one payment for $1,050 four years from toda

11、y. What is the internal rate of return on the bonds cash flows?(a)1.06%(b)1.48%(c)10.6%(d)14.8%Answer: (b)14.Calculate the NPV of the following cash flows: you invest $3,000 today and receive $300 one year from now, $700 two years from now, and $1,100 starting four years from now. Assume that the in

12、terest rate is 7%.(a)$1,962.62(b)$1,269.04(c)$1,269.04(d)$1,962.62Answer: (b)15.After each payment of an amortized loan, the outstanding balance is reduced by the amount of principal repaid. Therefore, the portion of the payment that goes toward the payment of interest is _ than the previous periods

13、 interest payment and the portion going toward repayment of principal is _ than the previous periods.(a)greater; lower(b)lower; lower(c)greater; greater(d)lower; greaterAnswer: (d)16.The present value of a future amount can be calculated with the equation _.(a) PV = FV(1 + i)n(b) PV = FV(1 + i)(n)(c

14、) PV = FV/(1 + i)n NOTE: this should be formatted as a stacked fraction (d) PV = FV/(1 + i)(n) NOTE: this should be formatted as a stacked fractionAnswer: (c)17.To compute the future value of a present amount use the compound amount factor defined as _.(a) FV = PV(1 + i)n(b) FV = PV(1 + i)(n)(c) FV

15、= PV/(1 + i)n NOTE: this should be formatted as a stacked fraction (d) FV = PV/(1 + i)(n) NOTE: this should be formatted as a stacked fraction Answer: (a)18.The earnings of BGB Computers have grown from $3.20 to $6.90 in 6 years. Determine the annual compound rate.(a)1.14%(b)13.7%(c)15.6%(d)115.6%An

16、swer: (b)19.In five years you intend to go to graduate school. For each of your four years in graduate school, you need to have a fund that will provide $25,000 per year at the beginning of each year. If the interest rate is 9% throughout, how much must you put in the fund today?(a)$64,996(b)$57,379

17、(c)$50,184(d)$16,249Answer: (b)20.As part of your new job at CyberInc. the company is providing you with a new Jeep. Your firm will lease this $34,000 Jeep for you. The terms of the lease are seven annual payments at an interest rate of 10%, which will fully amortize the cost of the car. What is the

18、 annual lease payment?(a)$6,984.39(b)$5,342.86(c)$4,857.14(d)$3,584.00Answer: (a)21.A rule of thumb with using the internal rate of return is to invest in a project if the IRR is _ the opportunity cost of capital.(a)greater than(b)less than(c)less than or equal to(d)one-half ofAnswer: (a)22.When con

19、sidering the timeframe of an investment, a rule followed by some is to choose the investment with _ payback period.(a)the longest(b)the shortest(c)no(d)an infiniteAnswer: (b)23.A major problem with using the internal rate of return rule is _.(a)there may be multiple cash outflows and multiple cash i

20、nflows(b)the internal rate of return may not exist(c)the internal rate of return may not be unique(d)all of the above Answer: (d)24.The NPV is the difference between the _ value of all _ cash inflows minus the _ value of all current and future cash outflows.(a)future; present; present(b)present; fut

21、ure; present(c)present; present; future(d)present; future; futureAnswer: (b)25.When considering effective interest rates, as the compounding frequency increases, the effective annual rate gets _ and _ but approaches _.(a)larger; larger; a limit(b)smaller; smaller; a limit(c)larger; larger; infinity(

22、d)smaller; smaller; infinityAnswer: (a)26.In 10 years you wish to own your business. How much will you have in your bank account at the end of 10 years if you deposit $300 each quarter (assume end of the period deposits) Assume the account is paying an interest rate of 12% compounded quarterly.(a)$2

23、0,220(b)$21,060(c)$21,626(d)$22,620Answer: (d)27.The director of marketing for CyberProducts Inc. plans to unleash a media blitz that is expected to cost $4.7 million three years from today. How much cash should she set aside today to pay for this if the current interest rate is 11% (a) $6.43 millio

24、n (b) $4.23 million (c) $3.62 million (d) $3.44 million Answer: (d)28.If you purchased a $10,000 certificate of deposit today with an APR of 12%, with monthly compounding, what would be the CD worth when it matures in 6 years? (a) $56,340 (b) $20,468 (c) $19,738 (d) $5,066 Answer: (b)29.The manufact

25、uring manager of CyberProducts Inc. estimates that she can save the company $16,000 cash per year over the next 8 years by implementing a recycling plan. What is the value of the savings today if the appropriate interest rate for the firm is 9% Assume cash flows occur at the end of the year. (a) $64

26、,240 (b) $88,557 (c) $96,527 (d) $128,000 Answer: (b)30.If the exchange rate between the U.S. dollar and the French Franc is $0.17 per French Franc, the dollar interest rate is 5.5% per year, and the French Franc interest rate is 4.5% per year, what is the break-even value of the future dollar/Frenc

27、h Franc exchange rate one year from now?a)$0.172 per FFb)$0.179 per FFc)$5.827 per FFd)$5.882 per FFAnswer: (a)31.In any time value of money calculation, the cash flows and the interest rate must be denominated _.a)in the same currencyb)in different currenciesc)in terms of a third currencyd)in terms

28、 of the ECUAnswer: (a)32.If the exchange rate between the U.S. dollar and the Japanese yen is $0.00745 per yen, the dollar interest rate is 6% per year, and the Japanese interest rate is 7% per year, what is the “break-even” value of the future dollar/yen exchange rate one year from now?a)$135.49 pe

29、r yenb)$134.23 per yenc)$0.00752 per yend)$0.00738 per yenAnswer: (d)33.Consider the situation where you are trying to decide if you should invest in a Swiss project or an American project. Both projects require an initial outlay of $15,000. The Swiss project will pay you 17,100 Swiss Francs per yea

30、r for 6 years, whereas the American one will pay you $11,000 per year for 6 years. The dollar interest rate is 5% per year, the Swiss Franc interest rate is 6% per year, and the current dollar price of a Swiss Franc is $0.68 per Swiss Franc. Which project has the higher NPV a)the U.S. project; its N

31、PV is $55,832b)the U.S. project; its NPV is $40,833c)the Swiss project; its NPV is $42,179d)the Swiss project; its NPV is $57,178Answer: (c)34.The _ is the rate denominated in dollars or in some other currency, and the _ is denominated in units of consumer goods.a)nominal interest rate; inflation inter