Finance Quiz

Interest rate is generally expressed as a percentage of the ______.

• Profit

• Principal

• Coupon

• Maturity value

The annual interest charged by lenders is also known as:

• APR

• APY

• ROI

• NPV

Simple interest is computed using which formula?

• P(1+i)^n

• P × I × N

• FV - PV

• (1+i)^n - 1

Compound interest is also known as:

• Interest on deposits

• Interest on loans

• Interest on interest

• Discounted interest

A credit card company charges 1% per month. Its APR is:

• 10%

• 12%

• 15%

• 18%

If the same 1% monthly interest is compounded, its APY is approximately:

• 12%

• 12.68%

• 15%

• 20%

Which of the following best represents a bond?

• Equity ownership in a company

• A loan made by an investor to a borrower

• A type of stock dividend

• Cash flow discounting tool

The nominal value of a bond is also called:

• Coupon rate

• Issue price

• Face value

• Market value

A bond paying interest annually at 10% on P1,000 face value has a coupon payment of:

• P10

• P50

• P100

• P1,000

Stocks represent:

• Debt instrument

• Ownership of a fraction of a corporation

• Fixed income securities

• Risk-free investment