# Shared Flashcard Set

## Details

Dugga - MCQ 1 - Finans 1 - SU - Fek1
Dugga - MCQ 1 - Finans 1 - SU - Fek1
19
Other
Beginner
12/09/2021

Term
 Dugga 1 är en MCQ (flervalsfrågor) och görs i moodle. ingen anmälan behövs.dugga 1 (MCQ quiz 1) has questions relating to the first three lectures. That is, up until and including the lecture on “Investment Decision Rules” and the corresponding video lectures.Time value of money 1 till 5.Investment Decision Rules 1 till 4.
Definition
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 Time value of money 1 till 5.
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 The Time Value Of Money video 1:
Definition
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 1.1 Finical decisions 1:What does it mean to make an "investment"?
Definition
 1. Give up resources today2. In the hope of obtaining something good in the future.
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 1.2 Finical decisions 2:What´s inside the timelines?
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 Periods (Years), Initial investments (at the start), Net cash flows.
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 1.3 Finical decisions 3:We always consider (Net)cash flows and in comparable terms.
Definition
 We don´t want to compare an investment in a building vs time spent on a lecture.
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 2.1 Time value of money video 1:What´s the assumption of "Time value of money"
Definition
 Assumption:Money recieved today is worth more than money recieved tomorrow.
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 2.2 Time value of money video 1:What the three reasons why we can assum that "Money recieved today is worth more than money recieved tomorrow."
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 Inflations - Interest -Uncertainty -
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 2.3 Time value of money video 1:What´s the math modell/formula to calculate "Future value of a cash flow"?
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 Future value = FV = C*(1+r)^NC = Present Cashflowr = Interest rate/n = "Years or periods into the future"
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 2.4 Time value of money video 1:What´s the math modell/formula to calculate "present value of a cash flow"?When you want the present value of a future value.
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 Present value = PV = C / (1+r)^nC = "Future value"r = Interest raten = number of periods
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 2.5 Time value of money video 1: (överkurs)How is the interest rate determined?
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 It should reflect at least,Inflation.Other investment opportunities.Risk.
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 2.6 Time value of money video 1:What are the 3 different names for interest rate?
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 Discount rate.Cost Of Capital.Hurdle rate.
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 The Time Value Of Money video 2:
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 Time value of money video 2:How do you calculate Net Present Value?
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 Net Present Value = NPV NPV = PV (Positive) - PV (Negative) = = PV (All cash flows)All cashflow summarized together - initial outlay = NPV.
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 Time value of money video 2:What is annuity?
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 Annuity is when, cashflows are of equal big size (the initial outlay does not need to be as big) and exactly one period between every cash flow.
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 Time value of money video 2:What is the calculation for a net present value of a annuity?
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 C/r * (1- 1/(1+r)^n) = Net Present Value Of A Annuity?Important!C = "first cash flow" in the model.r = interest rateN = the amount of cash flows
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 The Time Value Of Money video 3:Present value of a growing annuity.
Definition
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 Present value of a growing annuity:allows us to compute the present value of a growing annuity with a single formula.But what are the requirements?
Definition
 the growth between any two consecutive (i följd) cashflows need to be equally long between every cashflow.
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 What is the formula for "present value of a growing annuity"?
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