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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What formula do you use to calculate the present worth factor?
💡 Hint: Remember, it's about converting future values to today's values.
Question 2
Easy
Define Equivalent Annual Cost.
💡 Hint: Think about spreading costs over time.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What is the Present Worth Factor used for?
- To calculate taxes
- To find future cash flow
- To determine current value of future cash flows
💡 Hint: Think about financial analysis processes.
Question 2
True or False: Equivalent Annual Cost can help compare the annual cost of different long-term expenditures.
- True
- False
💡 Hint: Focus on the definition of EAC.
Solve and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
Calculate the present value of a future cash flow amounting to 1,000,000 rupees, expected in 5 years, using an interest rate of 8%.
💡 Hint: Make sure to remember the calculation method!
Question 2
Analyze when the cumulative operating cost exceeds initial purchase price when annual maintenance is expected to rise by 5% each year starting at 200,000.
💡 Hint: Take a step-by-step approach to analyze each year incrementally.
Challenge and get performance evaluation