From the Cash Flow Statement You Can Extract Criteria to Evaluate

question 60

True/False

From the cash flow statement you can extract criteria to evaluate a company's liquidity and financial leverage,which are indicators of stability and the possibility for future growth.

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Definitions:

Coupon Rate

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

Par-Value

The nominal or face value of a bond or stock, as stated by the issuer.

Duration

A measure of the sensitivity of a bond’s price to changes in interest rates, expressed as the weighted average time to receive the bond's cash flows.

Macaulay Duration

A measure of the weighted average time until a fixed income asset's cash flows are received, used to assess interest rate risk.