ALL CORRECT VERIFIED SOLUTIONS
NEW UPDATE
EXPLAIN THE CASH FLOW MODEL - Answers -✔✔ 1. INITIAL INVESTMENT
2. CASH FLOW OPERATION DURING THE HOLDING PERIOD (RENTAL
PAYMENTS)
3. CASH FLOW FROM DISPOSITION OF SALES PROCEED
4. HOLDING PERIOD (INTEREST) EARN ON INVESTMENT
WHAT FOUR BASIC QUESTION DO THE CASH FLOW MODEL ADDRESS - Answers
-✔✔ 1. HOW MANY DOLLAR GO INTO THE INVESTMENT
2. WHEN DO THE DOLLAR GO INTO THE INVESTMENT
3. HOW MANY DOLLARS COME OUT OF THE INVESTMENT
4. WHEN DO THE DOLLARS COME OUT OF THE INVESTMENT
TMV TIME VALUE OF MONEY PRINCPLE - Answers -✔✔ 1. WHAT WILL A N
INVESTMENT MADE TODAY BE WORTH IN THE FUTURE (COMPOUNDING)
2. WHAT IS PAYMENT RECEIVED TODAY WORTH IN THE FUTURE
(DISCOUNTING)
WHAT IS DISCOUNTING - Answers -✔✔ THE PROCESS OF DETERMINING THE
PRESENT VALUE
WHAT IS COMPOUNDING - Answers -✔✔ THE PROCESS OF DETERMINING
FUTURE VALUE
ANNUITY - Answers -✔✔ A SERIES OF EQUAL PAYMENTS OVER A SPECIFIC
PERIOD. EXAMPLES RENT OR LEASE PAYMENTS, RECURRING DEPOSIT TO AN
INTEREST-BEARING ACCOUNT
WHAT IS A SINKING FUND - Answers -✔✔ A STREAM OF EQUAL PAYMENTS THAT
IS SET ASIDE TO REACH A FUTURE TARGET AMOUNT EXAMPLE COLLEGE
FUND, RETIREMENT ACCOUNT ETC..
(IRR ) INTERNAL RATE OF RETURN - Answers -✔✔ THE PERCENTAGE RATE
EARNED ON EACH DOLLAR INVESTED FOR EACH PERIOD IT IS INVESTED