Please write clearly in block capitals.
Centre number Candidate number
Surname
Forename(s)
Candidate signatu re
I declare this is my own work.
A+level
Final Exam for BUS 320 – Chapters 2, 3,
9–12, 14–16- Complete Questions with
Verified Answers
Time allowed: 3 hours
Materials
For this paper you must have: For Examiner’s Use
• a calculator. Section Mark
A
Instructions
• Use black ink or black ball-point pen. B
• Fill in the boxes at the top of this page. C
• Answer all questions.
TOTAL
• You must answer the questions in the spaces provided. Do not write
outside the box around each page or on blank pages.
• If you need extra space for your answer(s), use the lined pages at the end
of this book. Write the question number against your answer(s).
• Do all rough work in this answer book. Cross through any
work you do not want to be marked.
Information
• The marks for each question are shown in brackets.
• The maximum mark for this paper is 120.
IB/G/Jun21/E8
, The interest factor for the future value of a single sum is equal to (1 + n)i. - ✔✔FALSE
The time value of money concept is fundamental to the analysis of cash inflow and outflow decisions covering periods of
over one year. - ✔✔TRUE
The interest factor for the present value of a single amount is the inverse of the future value interest factor. - ✔✔TRUE
Higher interest rates (discount rates) reduce the present value of amounts to be received in the future. - ✔✔TRUE
The present value of an annuity table provides a short-cut for calculating the future value of a steady stream of
payments, denoted as A. The same value can be calculated directly from the following equation:
PVa-A[1/(1-i)]^1+... - ✔✔TRUE
The farther into the future any given amount is received, the larger its present value. - ✔✔FALSE
An annuity is a series of consecutive payments of equal amount. - ✔✔TRUE
The amount of annual payments necessary to repay a mortgage loan can be found by reference to the present value of
an annuity table. - ✔✔TRUE
Par value and maturity value on a bond generally are the same. - ✔✔TRUE
Debentures are commonly issued by small companies. - ✔✔FALSE
If a company has promised to pay interest on debt, it must pay the interest even if it shows no profit for the year, or else
it may go bankrupt. - ✔✔TRUE
Bonds may be recalled only if there is a specific call provision in the bond. - ✔✔TRUE
Generally the greater the protection offered to a given class of bondholders, the higher will be the interest rate on the
bonds. - ✔✔FALSE
Centre number Candidate number
Surname
Forename(s)
Candidate signatu re
I declare this is my own work.
A+level
Final Exam for BUS 320 – Chapters 2, 3,
9–12, 14–16- Complete Questions with
Verified Answers
Time allowed: 3 hours
Materials
For this paper you must have: For Examiner’s Use
• a calculator. Section Mark
A
Instructions
• Use black ink or black ball-point pen. B
• Fill in the boxes at the top of this page. C
• Answer all questions.
TOTAL
• You must answer the questions in the spaces provided. Do not write
outside the box around each page or on blank pages.
• If you need extra space for your answer(s), use the lined pages at the end
of this book. Write the question number against your answer(s).
• Do all rough work in this answer book. Cross through any
work you do not want to be marked.
Information
• The marks for each question are shown in brackets.
• The maximum mark for this paper is 120.
IB/G/Jun21/E8
, The interest factor for the future value of a single sum is equal to (1 + n)i. - ✔✔FALSE
The time value of money concept is fundamental to the analysis of cash inflow and outflow decisions covering periods of
over one year. - ✔✔TRUE
The interest factor for the present value of a single amount is the inverse of the future value interest factor. - ✔✔TRUE
Higher interest rates (discount rates) reduce the present value of amounts to be received in the future. - ✔✔TRUE
The present value of an annuity table provides a short-cut for calculating the future value of a steady stream of
payments, denoted as A. The same value can be calculated directly from the following equation:
PVa-A[1/(1-i)]^1+... - ✔✔TRUE
The farther into the future any given amount is received, the larger its present value. - ✔✔FALSE
An annuity is a series of consecutive payments of equal amount. - ✔✔TRUE
The amount of annual payments necessary to repay a mortgage loan can be found by reference to the present value of
an annuity table. - ✔✔TRUE
Par value and maturity value on a bond generally are the same. - ✔✔TRUE
Debentures are commonly issued by small companies. - ✔✔FALSE
If a company has promised to pay interest on debt, it must pay the interest even if it shows no profit for the year, or else
it may go bankrupt. - ✔✔TRUE
Bonds may be recalled only if there is a specific call provision in the bond. - ✔✔TRUE
Generally the greater the protection offered to a given class of bondholders, the higher will be the interest rate on the
bonds. - ✔✔FALSE
