What care, if any, should be taken when cash flows occur in periodicities that are shorter than a year (e.g., quarterly or monthly cash flows)?
What will be an ideal response?
Answer: In the real world, cash flows can occur with any periodicity but interest rates are generally quoted in annual terms. As such, when cash flows occur at a shorter than annual time interval the interest rates have to be modified to correspond to the cash flow interval. One way to do that is to match the compounding period equal to cash flow interval.
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Answer the following statement(s) true (T) or false (F)
1. In general, with an amortized loan, the payment amount grows over the life of the loan, the principal portion of each payment grows over the life of the loan, and the interest portion declines over the life of the loan. 2. When computing an interest or growth rate, the rate will increase the larger the future value, holding present value and the number of periods constant. 3. When computing an interest or growth rate, the rate will decrease the larger the future value, holding present value and the number of periods constant. 4. When computing an interest or growth rate, the rate will increase the smaller the future value, holding present value and the number of periods constant. 5. When computing the number of deposits needed to accumulate to a future sum, it will take longer the lower the interest rate, holding the future value and deposit size constant.
Marc Leduc is angry with his boss for what he feels is unjustified criticism. He alters the system on his boss's computer, with the result that the boss can no longer access any data. What criminal offence has Marc committed?
A) Fraud B) Terrorism C) Unauthorized use of a computer D) Mischief in relation to data E) None of the above