Practice Summary Of Compounding Factors (3) - Uniform Series Capital Recovery Factor

Practice: Summary of Compounding Factors

Lesson 3Uniform Series Capital Recovery Factor

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9 questions

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2 cards from this section. Quick, good the night before a test.
Exercise
6 questions · about 4 min · pass mark 70%. Hints available.
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Quiz
3 questions · about 2 min · pass mark 70%. Hints available.
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6 sample questions

Question 1.
What does the Uniform Series Capital Recovery Factor compute?
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Think of loan payments.
Question 2.
Why is calculating the annual equivalent of costs helpful?
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Consider ease of management.
3Question 3.
What is the purpose of the Uniform Series Capital Recovery Factor?
- A: Calculates future worth only
- B: Computes loan repayments
- C: Only estimates salvage values
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Remember its application in loan scenarios.
4Question 4.
True or False: The Uniform Series Sinking Fund Factor is used to calculate how much to save each year to cover future capital expenditure.
- True
- False
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Think about future financial needs.
Question 5.
Calculate the annual payment for a $200,000 loan repaid over 10 years at a 7% interest rate.
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Start with the principal amount and apply the interest rate.
Question 6.
You want to generate $25,000 for machinery after 6 years. Using a sinking fund factor at 5% interest, how much do you need to save annually?
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Think of how interest will affect your total savings.

5 more questions in this section. Enroll free to practise them all.