1221. Time value of money indicates that __________.

A. A unit of money obtained today is worth more than a unit of money obtained in future . *
B. A unit of money obtained today is worth less than a unit of money obtained in future
C. There is no difference in the value of money obtained today and tomorrow.
D. None of the above

1222. Time value of money supports the comparison of cash flows recorded at different time period by _________.

A. Discounting all cash flows to a common point of time
B. Compounding all cash flows to a common point of time
C. Using either A or B *
D. None of the above

1223. If the nominal rate of interest is 10% per annum and there is quarterly compounding , the effective rate of interest will be __________.

A. 10% per annum
B. 10.10 % per annum
C. 10.25 % per annum
D. 10.38 % per annum *

1224. Relationship between annual nominal rate of interest and annual effective rate of interest, if frequency of compounding greater than one ____.

A. Effective rate > Nominal rate *
B. Effective rate < Nominal rate
C. Effective rate= Nominal rate
D. None of the above

1225. Mr X takes a loan of 50000 \$ From HDFC Bank. The rate of interest is 10% per annum. The first installement will be paid at the end of year 5 . Determine the amount of equal annual installments if Mr X wishes to repay the amount in five installments.

A. 19500 \$
B. 19400 \$
C. 19310 \$ *
D. None of the above

1226. If nominal rate of return is 10% per annum and annual effective rate of interest is 10.25% per annum, determine the frequency of compounding______.

A. 1
B. 2 *
C. 3
D. None of the above

1227. Present value tables for annuity cannot be straight away applied to varied stream of cash flows.

A. True *
B. False

1228. Heterogeneous cash flows can be made comparable by _______.

A. Discounting technique
B. Compounding technique
C. Either A or B *
D. None of the above

1229. What decision-making condition must exist in order for the decision tree to be a valuable tool?

A. Risk *
B. Certainty
C. Uncertainty
D. All of the above

1230. There are ________ needs in maslow’s hierarchy of needs .

A. 4
B. 6
C. 7
D. 5 *