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Questions and Answers
Which concept deals with the difference between simple and compound interest?
Which concept deals with the difference between simple and compound interest?
- Effective rate of interest
- Present value
- Time value of money (correct)
- Future value
What is the focus of the concept of annuity?
What is the focus of the concept of annuity?
- Irregular cash flows
- Present value of a single lump sum
- Regular payments or receipts over time (correct)
- Future value of a single lump sum
In which scenarios is the present value concept used?
In which scenarios is the present value concept used?
- Leasing, Capital expenditure, and Valuation of Bond (correct)
- Savings accounts, Stocks, and Mutual funds
- Real estate, Insurance, and Retirement planning
- Credit card debt, Mortgages, and Personal loans
What does the future value of an annuity represent?
What does the future value of an annuity represent?
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What is the concept used for determining the value of a bond?
What is the concept used for determining the value of a bond?
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