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Term Discounting Answer A Time value of money B. Amortized loan CA Ordinary annuity D. Annual percentage rate E. Description A concept that maintains that the owner of a cash flow will value it differently, depending on when it occurs. A cash flow stream that is created by a lease that requires the payment to be paid on the first of each month and a lease period of three years. The process of determining the present value of a cash flow or series of cash flows to be received or paid in the future. A cash flow stream that is generated by a share of preferred stock that is expected to mpy dividends every quarter indefinitely 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 value that represents the interest paid by borrowers or earned by lenders, expressed as a percentage of the amount borrowed or invested over a 12-month period. 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 loan in which the payments include interest as well as loan principal, A 6% return that you could have earned if you had made a particular investment 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. Annuity due F. > Perpetuity G. H. Future value Amortization schedule Opportunity cost of funds 1. J. Time value of money calculations can be solved using a mathematical equation, a financial calculator, or a spreadsheet. Which of the following equations can be used to solve for the present value of a lump sum? OPV/(1 + )" O PMT/ PV *(1 + )" O PMT X{1 - [1/(1+r)"]/

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