Wgu

Ordinary annuities - a series of equal payments made at the end of consecutive periods over a fixed length of time Annuities due - a series of equal payments made at the beginning of consecutive periods Perpetuities - a constant stream of identical cash flows that continues forever Compounding - finding a future value given a present value Discounting - finding a present value given a future value. Time value of money - the idea that money that is available at the present time is worth mor...

Real Return - Rate of growth in purchasing power of goods and services Holding Period Return - Return over the entire period that an investor owns a financial security Beta - A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. standard deviation - Used to measure the total risk of securities annuity due - an annuity whose payments occur at the beginning of each period, consecutively Par Bond - When the bond's coupon rate eq...

A local start-up company just hit its five-year anniversary and is planning an initial public offering sometime this year. In order to issue public stock, which market will the company use? - Primary market When a company issues stock for the first time to raise capital, shares must initially be sold through a primary market. About a year ago, the short-term Treasury bill had 1.54% interest and the long-term Treasury note had 2.54% interest. This week, the 1-year Treasury bill has an inter...

Finance - the study of managing and allocating funds at the personal or business level; forward looking What are the subspecialties of finance? - business finance, investments, and financial institutions Corporate finance - an area of finance that involves activities used to increase shareholder wealth Investments - an area of finance that deals with investment allocation and asset pricing financial institutions - an area of finance that involves organizations that accept deposits, offer i...

20 years ago Mateo started an investment account with $2000. He then invested $100 into the account every month at the end of each month. Today, he has $46,528 I. The same account. What is the term for the $100 monthly cash flows? - Annuity A company calculated variances of a budget and actual cash flows that indicate the firm's strengths and weaknesses in cash flows and its budgeting process. Which major use of cash budgeting is this an example of? - performance evaluation A company is d...

what is the difference between finance and accounting - The easiest way to describe these differences is that finance is forward-looking, or focuses primarily on the future, while accounting is generally backward-looking and focuses on the past. There are three primary areas in the world of finance: - Business finance Investments Financial institutions This area involves deciding which assets to invest in to create wealth in the future. - Investment The process of valuing assets - ASSETS ...

Finance vs. Accounting - Finance ~ Forward thinking Accounting ~ Looking at the past Finance defintion - Management and allocation of capital with the objective of investing, forecasting, budgeting, saving, borrowing, lending, and so on. Business finance - area of finance that deals with sources of funding, the capital structure of corporations, the actions that managers take to increase the value of a firm for its owners, and the tools and analysis used to allocate financial resources. O...

Accounting - The system of recording, reporting, and summarizing past financial information and transactions. Accounts Receivable Turnover (AR Turnover) - An activity ratio found by credit sales divided by accounts receivable. Activity Ratios - A category of ratios that measure how well a company uses its assets to generate sales or cash, showing the firm's operational efficiency and profitability. Additional Funds Needed (AFN) - Another name for the discretionary financing needed or ex...

A company called Bobby's Books is considering purchasing a new bookbinding machine. The company calculates the hurdle rate of the project to be 9% and the IRR to be 11%. Should the company purchase the bookbinding machine? a) No, because the old bookbinding machine still works. b) Yes, because the IRR exceeds the cost of capital. c) No, because the hurdle rate is lower than the IRR. d) Yes, because newer models of equipment are always profitable investments. - b) Yes, because the IRR exc...

Which area of finance deals with sources of funding and the capital structure of corporations and seeks to increase the value of a firm to its owners? a) Financial institutions b) Real estate c) Investments d) Business finance - d) Business finance Business finance is the area of finance that deals with uses and sources of funding to increase the value of the firm. What is the primary difference between finance and accounting? a) Accounting involves investing and forecasting, while fina...