10. Time Value of Money

The relationship between the present value (PV) and the investment time period, assuming a positive interest rate, is best described as:

Which one of the following statements correctly defines a time value of money relationship?

Given a present value of \$1,000, an annual interest rate of 6\% compounded annually, and a time period of 3 years, what is the future value (FV) using the time value of money equation?

When something earns compound interest, it earns interest on:

Interest rates are expressed as a percentage of which of the following?

What is the present value of \$6 to be received in 3 years, discounted at an annual interest rate of 5% compounded annually?

Which one of the following is an ordinary annuity, but not a perpetuity?

A dollar paid (or received) in the future is:

All else held constant, the present value of an annuity will decrease if you:

Compared to a similar fixed payment loan, the total interest paid on a fixed principal loan is:

Which of the following equations correctly calculates the future value (\(FV\)) of \$1,000 invested today for 3 years at 5\% annual interest compounded annually?

Which of the following affects the present value of an investment?

The concept of the time value of money indicates that:

Which of the following would increase the present value of a single future cash flow, assuming all other factors remain constant?

Which of the following is the correct formula for calculating simple interest?