Questions from Corporate Finance


Q: Why is a dollar today worth more than a dollar one year

Why is a dollar today worth more than a dollar one year from now?

See Answer

Q: Because the conversion feature in a convertible bond is valuable to bondholders

Because the conversion feature in a convertible bond is valuable to bondholders, convertible bond issues have lower coupon payments than otherwise similar bonds that are not convertible. Does this mea...

See Answer

Q: What is compounding, and how does it affect the future value

What is compounding, and how does it affect the future value of an investment?

See Answer

Q: How does changing the compounding period affect the amount of interest earned

How does changing the compounding period affect the amount of interest earned on an investment?

See Answer

Q: Explain why you would expect the discount factor to become smaller when

Explain why you would expect the discount factor to become smaller when based on the longer the time to payment?

See Answer

Q: Explain how to calculate the present value of a stream of cash

Explain how to calculate the present value of a stream of cash flows?

See Answer

Q: Why is it important to adjust all cash flows to a common

Why is it important to adjust all cash flows to a common date?

See Answer

Q: Explain how to calculate the future value of a stream of cash

Explain how to calculate the future value of a stream of cash flows?

See Answer

Q: How do an ordinary annuity, an annuity due, and a

How do an ordinary annuity, an annuity due, and a perpetuity differ?

See Answer

Q: Give two examples of perpetuities?

Give two examples of perpetuities?

See Answer