Which of the Following Statements Is CORRECT

question 33

Multiple Choice

Which of the following statements is CORRECT?

• A) The present value of a 3-year,$150 ordinary annuity will exceed the present value of a 3-year,$150 annuity due.
• B) If a loan has a nominal annual rate of 8%,then the effective rate will never be less than 8%.
• C) If a loan or investment has annual payments,then the effective,periodic,and nominal rates of interest will all be different.
• D) The proportion of the payment that goes toward interest on a fully amortized loan increases over time.
• E) An investment that has a nominal rate of 6% with semiannual payments will have an effective rate that is smaller than 6%.

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Definitions:

Areas of Concern

Specific issues or problems that need attention or resolution in a given context.

Professionalism

The conduct, aims, or qualities that characterize or mark a profession or a professional person.

Mini Skirt

A very short skirt ending well above the knees.

Costume Jewelry

Fashion accessories made from non-precious materials intended to complement a particular outfit or style rather than serve as long-term investments.