Term
Discounting
Time value of money
Amortized loan
Ordinary annuity
Annual percentage rate
Annuity due
Perpetuity
Future value
Amortization schedule
Opportunity cost of funds
Answer
A.
B.
C.
D.
E.
F.
G.
H.
I.
J.
Description
The concept that states that the timing of the receipt or payment of a cash flow will affect
its value to the holder of the cash flow.
One of the four major time value of money terms; the amount to which an individual cash
flow or series of cash payments or receipts will grow over a period of time when earning
interest at a given rate of interest.
A type of security that is frequently used in mortgages and requires that the loan payment
contain both interest and loan principal.
An interest rate that reflects the return required by a lender and paid by a borrower,
expressed as a percentage of the principal borrowed.
A series of equal cash flows that occur at the end of each of the equally spaced intervals
(such as daily, monthly, quarterly, and so on).
A schedule or table that reports the amount of principal and the amount of interest that
make up each payment made to repay a loan by the end of its regular term.
A process that involves calculating the current value of a future cash flow or series of cash
flows based on a certain interest rate.
A 6% return that you could have earned if you had made a particular investment.
A cash flow stream that is generated by a share of preferred stock that is expected to pay
dividends every quarter indefinitely.
A series of equal cash flows that occur at the beginning of each of the equally spaced
intervals (such as daily, monthly, quarterly, and so on).