1. When the interests of the owners of a firm do not coincide with the interests of the managers of the firm, the literature of business calls this _______.
an organizational disconnect.
a behavioral problem.
an agency problem.
territorial issues.
the Dilbert effect.
2. You invested $1,000 in an account which pays interest at the rate of 2% per quarter. How much will be in this account at the end of three years? Remember that the interest compounds.
$1,268.24
$1,200.00
$1,061.21
$1,259.71
$1,195.09
3. A company must make a large payment two years from now. The amount of that payment is $340,000. The company places $288,655.15 in an investment account today, in order to have $340,000 to make the payment in two years. What annual rate of return must the company be assuming?
1.18%
8.53%
8.90%
17.06%
17.79%
4. That vacation package to Barbados three years from now has a price of $4,100, not including airfare. If you can earn 9% per year in an investment account, what amount must you deposit in that account today in order to have $4,100 at the end of three years?
$1,253.82
$3,450.89
$3,761.47
$3,165.95
$4,088.95