Which of the Following Is NOT True When Developing a Time

question 148

Multiple Choice

Which of the following is NOT true when developing a time line?

• A) Cash inflows are designated with a positive number.
• B) Cash outflows are designated with a positive number.
• C) The cost is known as the interest rate.
• D) The time line shows the magnitude of cash flows at different points in time.

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Definitions:

Yield To Maturity

The total return anticipated on a bond if it is held until it matures, including all interest payments and the repayment of principal.

Coupon Rate

The annual interest rate paid by a bond issuer to the bondholders, typically expressed as a percentage of the bond's face value.

Intrinsic Value

The inherent or actual value of an asset, investment, or company, based on underlying perception of its true value including all aspects of the business.

Annual

Refers to something occurring once every year.