Question 1: The present value of a single sum of $100 to be received in 10 years and discounted at a annual 12% rate on a semi-annual basis is:
a. $32.19
b. $31.18
c. $100
d. $310.58
Question 2: The best way to compare two sums to be received at different times in the future is to compute:
a. The present value of each sum.
b. The future value of each sum
c. Compare each sum directly without regard to compound interest
d. None of these
Question 3: Which factor would you use when computing the present value of a series of rent payments, assuming the rent is paid at the beginning of each period as in a standard lease:
a. PVIFA(periods, rate)
b. FVIFA(periods, rate)
c. PVIFA(periods, rate) x (1+rate)
d. PVIF(periods, rate)