运营管理 考试题库krajewski_om9_tif_SuppF.doc

Supplement F Financial Analysis TRUE/FALSE The time value of money implies that a dollar in hand today is worth more than a dollar to be received in the future. Answer: True Reference: Time Value of Money Difficulty: Easy Keywords: time value of money Discounting is the process by which interest on an investment accumulates, and then earns interest itself for the remainder of the investment period. Answer: False Reference: Time Value of Money Difficulty: Moderate Keywords: compounding interest The value of an investment at the end of the period over which interest is compounded is called the future value of the investment. Answer: True Reference: Time Value of Money Difficulty: Easy Keywords: future value The present value of an investment is the amount that must be invested now to accumulate to a certain amount in the future at a specific interest rate. Answer: True Reference: Time Value of Money Difficulty: Moderate Keywords: present value The interest rate is also called the discount rate. Answer: True Reference: Time Value of Money Difficulty: Moderate Keywords: interest rate, discount rate An annuity is a series of payments of a fixed amount for a specified number of years. Answer: True Reference: Time Value of Money Difficulty: Easy Keywords: annuity payment Cash flow is the cash that will flow into and out of the organization. Answer: True Reference: Techniques of Analysis Difficulty: Easy Keywords: cash flow Depreciation is not a legitimate cash flow. Answer: True Reference: Techniques of Analysis Difficulty: Moderate Keywords: depreciation, cash flow Straight-line depreciation is an accelerated depreciation method. Answer: False Reference: Techniques of Analysis Difficulty: Moderate Keywords: depreciation, accelerated depreciation, straight-line depreciation The advantage of using the modified accelerated cost recovery system (MACRS) for depreciation is that it extends the lives of investments, giving a firm a longer period of time before the item must