Question 1

A(n) _____ changes values by a constant amount.

Accepted Answer

A linear trend changes values by a constant amount, as it represents a straight line with a constant slope.

Question 2

Samira has a workbook containing many worksheets with interconnected formulas. What can she use to display the values of specified cells located throughout the workbook?

Accepted Answer

The Watch Window can be used to display the values of specified cells located throughout the workbook. It allows you to add and monitor cells, ranges, and formulas from different worksheets in one place. The Observe Formula dialog box is used to trace cell references, the Show Formulas command displays all formulas in the worksheet instead of their results, and the Automatic Update Window updates links between workbooks automatically.

Question 3

Which of the following formulas would you use to calculate the fourth year of depreciation of a $100,000 loan that declines to a salvage value of $25,000 after 10 years?

Accepted Answer

The DB function is used for declining balance depreciation, which is appropriate for calculating depreciation over multiple years. The formula DB(100000, 25000, 10, 4) correctly includes the initial cost, salvage value, useful life, and the specific year for which depreciation is being calculated.

Question 4

How can you correct an error such as the #NAME? error in a worksheet?

Accepted Answer

To correct a #NAME? error, you need to trace the cell precedents and dependents to find the source of the error. This involves identifying any cells that the formula references incorrectly. Once you've identified the source of the error, you can correct it by either correcting the reference or changing the formula. Ignoring the error, opening the Watch Window, and using absolute references may not necessarily solve the problem.

Question 5

What does the IRR function calculate?

Accepted Answer

The IRR function calculates the internal rate of return for an investment, which is the rate at which the net present value of the investment equals zero. This is an important metric for evaluating the profitability or desirability of an investment.

Question 6

Allison's small business earns $10,000 in January. She expects income to increase by 5 percent per month until the end of the year. To use Excel to calculate monthly income from February to December, Allison can fill a series with a trend.

Accepted Answer

Allison can use Excel's fill feature to create a series that increases by 5% each month and calculates the income for each month based on the previous month's income. This is called a trend and is a useful tool for forecasting future values based on historical data.

Question 7

To display a tracer arrow to each cell providing direct data to the active cell, click Formulas tab > Formula Auditing group > Trace Precedents.

Accepted Answer

The statement is correct. To display a tracer arrow to each cell providing direct data to the active cell, you need to go to the Formulas tab, Formula Auditing group, and click on Trace Precedents.

Question 8

To remove trace arrows in a cell, select the cell, then click Formulas > Arrow beside Remove Arrows > The type of arrow you want to remove from the list.

Accepted Answer

This is the correct step-by-step process to remove trace arrows in Excel.

Question 9

The NPV function calculates a loan's interest rate.

Accepted Answer

The NPV function calculates the net present value of a series of cash flows, and does not directly calculate a loan's interest rate.

Question 10

To calculate the total interest paid on a loan over a full year, you use the CUMPRINC function.

Accepted Answer

The CUMPRINC function is used to calculate cumulative principal paid on a loan over a certain period. To calculate the total interest paid over a full year, you would need to use a different function such as CUMIPMT or simply subtract the principal paid from the total payments made.

Question 11

Which function should you use to calculate the present value of an investment that pays different amounts each year?

Accepted Answer

NPV (Net Present Value) function is used to calculate the present value of an investment that pays different amounts each year. It takes into account the cash flows of the investment, the discount rate, and the period over which the payments will be made. Other functions such as PMT (Payment) are used to calculate the regular payments on an investment or loan, FV (Future Value) is used to calculate the future value of an investment after a certain period, and DPV (Discounted Present Value) is not a standard function in Excel.

Question 12

Which formula auditing tool can you use to display the value of each part of a formula?

Accepted Answer

The Evaluate Formula dialog box allows you to step through a formula and see the value of each part of the formula, making it easier to identify errors or logic flaws in complex formulas. Trace Precedents and Trace Dependents highlight the cells that are used in or depend on a formula, respectively. Formula Validation checks the accuracy and completeness of a formula, but does not display the value of each part of the formula.

Question 13

Jamal bought $100,000 worth of equipment for his business. Which function can he use to calculate the equal amounts of value the equipment will lose each year?

Accepted Answer

Jamal can use the SLN function, which stands for straight-line depreciation, to calculate the equal amounts of value the equipment will lose each year. This function assumes that the equipment will lose an equal amount of value each year over its expected lifespan.

Question 14

The CUMIPMT function has the syntax CUMIPMT(Rate, Nper, Pv, Start, End, Type). What do you enter for the Type argument?

Accepted Answer

The Type argument is used to indicate whether payments are made at the beginning or end of the period. Enter 0 for payments made at the end and 1 for payments made at the beginning.

Question 15

To calculate the cumulative total of payments made toward the principal of a loan, you use the _____ function.

Accepted Answer

The CUMPRINC function is specifically designed to calculate the cumulative principal payments made on a loan. The other functions listed are not designed for this specific calculation.

Question 16

A(n) _____ changes values by a constant percentage.

Accepted Answer

A growth trend changes values by a constant percentage, reflecting a proportional increase over time. A step trend reflects a sudden and distinct change, an AutoFill trend is a feature in Excel that automatically fills in a series of cells with a pattern, and a linear trend reflects a consistent increase or decrease over time, rather than a proportional increase.

Question 17

To display a tracer arrow to each cell providing direct data that is dependent on the active cell, click Formulas tab > Formula Auditing group > Trace Dependents.

Accepted Answer

This is the correct process to display tracer arrows for cells dependent on the active cell.

Question 18

You use the Evaluate Formula dialog box to enter a formula that uses a financial function.

Accepted Answer

The Evaluate Formula dialog box in Excel is used to step through and evaluate each part of a formula to understand how it calculates the result, not to enter a formula.

Question 19

To use the SLN function to calculate the depreciation of an asset, you need to know the cost, salvage value, and life of the asset.

Accepted Answer

The SLN function in Microsoft Excel is used to calculate straight-line depreciation, and requires the cost, salvage value, and useful life of the asset as inputs.

Question 20

Which Excel dialog box do you use to fill a series based on extrapolation?

Accepted Answer

The answer of Which Excel dialog box do you use...

Quiz 2: Excel 2019