Tuesday, February 5, 2013

Ch.5 Questions By Jazmin Padilla

Ch.5 Questions
By Jazmin Padilla

1. One dollar today is worth one dollar in the future. 

2. The rate of return affects value and the choices we make. 

3. The process of determining future value given the present value, rate of return, and number of years is called
  1. Discounting
  2. Compounding
  3. Annuity
  4. Amortization

4. What is the future value of 120,000 given a 20% rate of return in five years?
  1. 298,598.40
  2. 289,500.00
  3. 320,355.40
  4. 267,999.90

5. Discounting is the procedural reciprocal of compounding. 

6. The higher the rate of return the lower the future value. 

7. The most common mortgage is an annuity of fixed payments.

8. ____offers insight of the overall price of the property in the real estate market.
  1. return measures
  2. leverage risk measures
  3. value ratios
  4. operating relationships

1.F 2.T 3.B 4.A  5.T 6.F 7.T 8.C

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