EME 460 Exam 1 UPDATED ACTUAL QUESTIONS AND CORRECT ANSWERS

EME 460 Exam 1 UPDATED ACTUAL QUESTIONS AND CORRECT ANSWERS Given Present value, time, and rate, what is the future value? - CORRECT ANSWER P(1+r)^n F = Given a uniform series of equal payments, A, and time, what is the future value? - CORRECT ANSWER F = A[(1+i)^n]/i In a uniform series of equal payments, how much money needs deposited every month when given future value, time, and interest? - CORRECT ANSWER A = (F*i) / [(1+i)^n -1] Given a uniform series of equal payments of amount A, interest, and time, find present value - CORRECT ANSWER First find Future using F = A[(1+i)^n]/i Secondly find Present using P = F/(1+i)^n Given a cash flow, find Net Present Value (NPV) if given i - CORRECT ANSWER of all DCF To find DCF: P = F/[(1+i)^n] Before Investing, what should you look at? - CORRECT ANSWER also be called ROI Cost Benefit Ratio (BCR) Net Present Value (NPV) Present Value Ratio (PVR) IRR Payback Time How to calculate NPV - CORRECT ANSWER NPV = sum Rate of Return(ROR) can Sum of DCF which equals: P = F/ (1+i)^n How to calculate ROR/ROI - CORRECT ANSWER NPV/Inv * 100 How to calculate IRR - CORRECT ANSWER only can calculate on excel IRR is the discount rate that makes NPV zero, How to calculate Benefit Cost Ratio (BCR) - CORRECT ANSWER Or PVR + 1 How to calculate Present Value Ratio (PVR) - CORRECT ANSWER or NPV/inv How to calculate Payback time - CORRECT ANSWER (NPV + inv)/inv BCR - 1