Clfp Exam - Pricing

What is Internal Rate of Return? {Ans: is the interest rate that makes the present value of the cash flows equal to the investment. Also know as discounted cash flow rate of return. "What discount rate should I use in order to get the net present value to equal zero?"}Whis is BEG/END on a financial Calculator? {Ans: 1) Represents when the payments will be billed; 2. BEG - billed at beg. of period 3. END - billed at end of period}What is Implicit Rate? {Ans: the value of rent (payments) and residual stated as an annual percentage rate.}If you were to consider tax treatment, how is a True Lease profit calculation impacted? {Ans: 1.) Condition sales - steady interest income pay more taxable income earlier 2.) True Lease - MACRS expense can offset income early in leas. Result - defer taxable income/paying taxes until later - TVM enhancement}What are some tools you can use to more effectively take tax impact into pricing/profit calculation. {Ans: 1.) SuperTrump - Ivory Consulting Corp 2.) InfoAnalysis - International Decision Systems}How does BEG/END impact cost of financing? {Ans: 1.) Lender: lower implicit rate on END due to receiving payments