Question 1 5 pts

0 multiple_choice_question 22046808

The internal rate of return (IRR) is the interest rate that sets the net present value of the future cash flows equal to ________.

Question 2 5 pts

On a timeline, the space between date 0 and date 1 represents the _______ between dates. Letâs assume it is the first year of the loan. Date 0 is the beginning of the first year, and date 1 is the end of the first year.

Question 3 5 pts

As the interest rate __________, present value decreases.

Question 4 5 pts

The present value (PV) of a stream of cash flows is the _______ the present values of each individual cash flow

Question 5 5 pts

When a constant cash flow will occur at regular intervals for a finite number of periods of time, it is called a(n) __________.

Question 6 5 pts

Edit this Question Delete this Question

0 multiple_choice_question 22047052

There are two basic types of annuities:

Discounted and compounded annuities

Ordinary annuities and annuities due.

Future value and present value annuities

None of the above

Question 7 5 pts

The NPV measures the ______ change in shareholder wealth that arises from undertaking a project.

Question 8 5 pts

The Net Present Value rule implies that we should compare a projectâs net present value (NPV) to ________

Question 9 5 pts

To endow a perpetuity is the same as calculating the present value (PV) of a perpetuity. Say you want to endow an annual graduation party at your alma mater. You want the event to be a memorable one, so you budget $30,000 per year forever for the party. If the university earns 8% per year on its investments, and if the first party is in one yearâs time, how much will you need to donate to endow the party?

The formula for PV of a perpetuity = C\r; = $30,000 \ 0.08; =

To endow a perpetuity is the same as calculating the present value (PV) of a perpetuity. Say you want to endow an annual graduation party at your alma mater. You want the event to be a memorable one, so you budget $30,000 per year forever for the party. If the university earns 8% per year on its investments, and if the first party is in one yearâs time, how much will you need to donate to endow the party?

The formula for PV of a perpetuity = C\r; = $30,000 \ 0.08; =

Question 10 5 pts

With an Ordinary Annuity, payments are required at the ________ of each period. An example of this is bonds which usually pay coupon payments at the end of every six months until the bond's maturity date.

beginning

middle

end

payments are not required

limemacaw827

Cash conversion cycle

The text identifies three principal components that jointly comprise the cash conversion cycle. The cash conversion cycle is defined as the average length of time a dollar is tied up in current assets, and it is determined by the interaction between the inventory conversion period, receivables collection period, and the payables deferral period. Ideally, a company wants to minimize the cash conversion cycle as much as possible. In some circumstances, a firm has a comparative advantage in working capital management because of the nature of its business. We will look at the cash conversion cycles of companies and their implications.

In your initial response to the topic you have to answer all 6 questions.

You are expected to make your own contribution in a main topic as well as respond with value added comments to at least two of your classmates as well as to your instructor.

Go to http://finance.yahoo.com and get a quote for one company of your choice. On the left column, scroll down and select âIncome Statement.â Write down the annual sales and cost of goods sold for the most recent two years.

Select the firm's Balance Sheet. Write down the balances shown for the firm's inventories, accounts receivable, and accounts payable.

Using the information from parts a and b, calculate its inventory turnover, accounts receivable turnover, and accounts payable turnover. You should show your work!

Calculate production cycle, collection cycle, and accounts payable cycle. You should show your work!

What is the companyâs cash conversion cycle? You should show your work!

Discuss the results that you receive in one paragraph. Should the company decrease cash conversion cycle? Please explain your answer.

In your responses to other students compare the cash conversion cycles of your company with the cash conversion cycle in another studentâs posting. What factors are responsible for these differences? Are these differences firm specific or are they consequences of the nature of the businesses in which these firms operate? Please explain your answers.

tanrhinoceros524

a perpetuity pays 1 every january 1 starting in 2020. The effective rate of interest will be i in odd numbered years and j in even-numbered years. Find an expression for the present value of the perpetuity on January 1, 2019.

The correct solution is Vj[1+Vi]*[1/(1-VjVi)] but i do not understand how this works. I know the formula to find the present value of a perpetuity is D/r, so i thought it would be .5[1/i+i/j] since each of the formulas for i and j are only half of the years. Please fix my logic here.

Contrary to the comment below there are no factors missing to solve this problem, granted you know the material. I provided the solution, which i found was based on a formula made specifically for even and odd year problems. I simply need someone who understands the material to give a step by step to get the solution with explanation if possible. Thanks in advance, it would be very helpful.

FIN 300 Study Guide - Final Guide: Risk-Free Interest Rate, Sunk Costs, Capital Budgeting

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