IMANET Exam CMA Topic 1 Question 109 Discussion

Actual exam question for IMANET's CMA exam

Question #: 109
Topic #: 1

[All CMA Questions]

The discount rate ordinal' used in present value calculations is the

AFederal Reserve rate

BTreasury bill rate.

CMinimum desired rate of return set by the firm.

DPrime rate.

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Suggested Answer: B

If the 8% return exactly equals the present value of the future flows ., NPV is zero), then simply determine the present value of the future inflows. Thus, Hopkins Company's initial cash outlay is $19,090 [($2,500)(PVIFA at 8% for 10 periods) + ($5J00)(PVlF at 8% for 10 periods ($2,500)(6.710) + ($5,000)(.463)].

by Lina at Mar 23, 2025, 06:53 PM

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Edwin

3 hours ago

I think the discount rate ordinal used in present value calculations is the Treasury bill rate.

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