Multiple choice

1) If you invest $8,000 at 12% interest, how much will you have in 7 years? 

A.-$17,688

B.-$80,712

C.-$3616

D.-$18,016

2) In determining the future value of a single amount, one measures 

A. the present value of an amount discounted at a given interest rate.

B. the present value of periodic payments at a given interest rate.

C. the future value of an amount allowed to grow at a given interest rate.

D. the future value of periodic payments at a given interest rate.

3) The three primary policy variables to consider when extending credit include all of the following except 

A. the level of inflation.

B. credit standards.

C. the terms of trade.

D. collection policy.

4) An aggressive working capital policy would have which of following characteristics? 

A. A low ratio of short-term debt to fixed assets.

B. A high ratio of long-term debt to fixed assets.

C. A high ratio of short-term debt to long-term sources of funds.

D. A short average collection period.