If a seller recovers his capital along with accumulated compensating interest not in one single lump-sum payment but in periodical equal payments, over time:

Related MCQs

• Relationship between annual nominal rate of interest and annual effective rate of interest, if frequency of compounding is greater than one:
• If the nominal rate of interest is 10% per annum and there is quarterly compounding, the effective rate of interest will be:
• If interest is paid more than once in a year, ‘i’ is the rate of interest per year, ‘n’ is the number of periods in years and ‘m’ is a number of periods per years, compound amount factor (CAF) is:
• If ‘P’ is principal amount, ‘i’ is the rate of interest and ‘n’ is the number of periods in years, then the interest factor is:
• Mr. X takes a loan of Rs 50,000 from HDFC Bank. The rate of interest is 10% per annum. The first installment will be paid at the end of year 5. Determine the amount of equal annual installments if Mr. X wishes to repay the amount in five installments.
• Time value of money supports the comparison of cash flows recorded at different time period by
• In cash flow statement, the item of interest is shown in A) Operating Activities B) Financing Activities C) Investing Activities
• If nominal rate of return is 10% per annum and annual effective rate of interest is 10.25% per annum, determine the frequency of compounding:
• The interest calculated on the basis of 365 days a year, is known as:
• If ‘P’ is principal amount, ‘I’ is the rate of interest per annum and ‘n’ is the number of periods in years, the compound amount factor (CAF) is: