Question

List A List B 1. Interest a. First cash flow occurs one period after agreement begins 2. Monetary asset b. The rate at which money will actually grow during a year 3. Compound interest c. First cash flow occurs on the first day of the agreement 4. Simple interest d. The amount of money that a dollar will grow to 5. Annuity e. Amount of money paid/received in excess of amount borrowed/lent 6. Present value of a single amount f. Obligation to pay a sum of cash, the amount of which is fixed 7. Annuity due g. Money can be invested today and grow to a larger amount 8. Future value of a single amount h. No fixed dollar amount attached 9. Ordinary annuity i. Computed by multiplying an invested amount by the interest rate 10. Effective rate or yield j. Interest calculated on invested amount plus accumulated interest 11. Nonmonetary asset k. A series of equal-sized cash flows 12. Time value of money l. Amount of money required today that is equivalent to a given future amount 13. Monetary liability m. Claim to receive a fixed amount of money

Answer 1

Answer:

1. List A: Interest

List B: e. Amount of money paid/received in excess of amount borrowed/lent

2. List A: Monetary asset

List B: m. Claim to receive a fixed amount of money

3. List A: Compound interest

List B: j. Interest calculated on invested amount plus accumulated interest

4. List A: Simple interest

List B: i. Computed by multiplying an invested amount by the interest rate

5. List A: Annuity

List B: k. A series of equal-sized cash flows

6. List A: Present value of a single amount

List B:  l. Amount of money required today that is equivalent to a given future amount

7. List A: Annuity due

List B: c. First cash flow occurs on the first day of the agreement

8. List A: Future value of a single amount

List B: d. The amount of money that a dollar will grow to

9. List A: Ordinary annuity

List B: a. First cash flow occurs one period after agreement begins

10. List A: Effective rate or yield

List B: b. The rate at which money will actually grow during a year

11. List A: Nonmonetary asset

List B: h. No fixed dollar amount attached

12. List A: Time value of money

List B: g. Money can be invested today and grow to a larger amount

13. List A: Monetary liability

f. Obligation to pay a sum of cash, the amount of which is fixed