Multiple Choice Questions
The interest payment in an amortization schedule is calculated from?
a)Ending Balance
b)Beginning Balance
c)Principal
d)Payment
A specific type of income stream characterized by equal periodic payments over its life is called what?
a)Principal
b)IRR
c)NPV
d)Annuity
Another term for a real estate borrower is called what?
a)Mortgagee
b)Mortgagor
c)Developer
d)Realtor
True/False Questions
According to time value of money, receiving a dollar in 3 years from now is better than a year from now.
- True
- False
IRR defines the discount rate where the NPV equals 0.
- True
- False
Always accepting a positive PV.
- True
- False
The annuity in an amortization schedule is variable.
- True
- False
NPV and IRR are used to make investment decisions.
- True
- False
Solutions
b) d) b)
False, True, True, False, True
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