Applications Of Present Value Flashcards
1
Q
Equivalent Annual Cost (EAC)
A
(NPVproject x r) / (1-1/(1+r)^t)
2
Q
Bond
A
Loan issued with specific conditions by an issuer, and subscribed or purchased.
3
Q
Characteristics of a bond
A
- Coupon
- Start and maturity dates
- Issue Price
- Redemption Price
4
Q
Share
A
Piece of ownership of a firm
5
Q
Value of a share
A
Sum of present values of dividends
