Payments to Creditors That Include Interest and the Repayment of Principal

question 32

Multiple Choice

Payments to creditors that include interest and the repayment of principal are referred to as:

• A)the cash flow to stockholders.
• B)the reduction in net working capital.
• C)debt service.
• D)operating cash flow.
• E)the change in net working capital.

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Definitions:

CPI

This index measures the average prices across a specified set of consumer goods and services, weighted accordingly, to serve as a benchmark for inflation, known as the Consumer Price Index.

Consumer Price Index

A measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care, used to estimate the economy's inflation rate.

Inflation Rate

The annual percentage increase in the general price level of goods and services, reflecting the rate at which the purchasing power of currency is eroded.

Market Basket

A fixed list of items, used to track the progress of inflation in an economy or to compare costs of living.