chapter 5 Flashcards
1
Q
what do all individuals and businesses face the same two basic finance related problems?
A
where to put the money
where to get the money
2
Q
what are the two decisions?
A
investment decision
financing decision
3
Q
addressing the financing problem requires businesses to seek out funding sources such as ________ by investors or borrowing from financial institutions such as _____
A
equity infusion
banks
4
Q
what are the two concept of interest
A
simple interest
compound interest
5
Q
_______ is simply earning interest
A
compound interest
6
Q
one very useful application of the time value of money is when the ___________ is used to determine whether a project should be accepted or rejected by a company.
A
net present value method
7
Q
A
