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- Chapter 10 Homework Questions 1. Explain why money has a time value. 2. What is the difference between simple interest and compound interest? 3. Explain the Rule of 72. 4. What is the meaning of present value (PV)? 5. What do we mean by internal rate of return (IRR)How can we calculate earnings per share?How does the constant–growth model influence financial decisions regarding risk and return?
- Net sales ??Suppose interest rates in the economy increase. How would such a change affect the costs of both debt and common equity based on the CAPM?Which one of the following is a measure of long term solvency? A. Price earning ratio B. Profit margin C. Cash coverage ratio D. Receivables turnover E. Quick ratio