Which of the Following Statements Is CORRECT

question 64

Multiple Choice

Which of the following statements is CORRECT?

• A) An investment that has a nominal rate of 6% with semiannual payments will have an effective rate that is smaller than 6%.
• B) The present value of a 3-year, $150 ordinary annuity will exceed the present value of a 3-year, $150 annuity due.
• C) If a loan has a nominal annual rate of 7%, then the effective rate will never be less than 7%.
• D) If a loan or investment has annual payments, then the effective, periodic, and nominal rates of interest will all be different.
• E) The proportion of the payment that goes toward interest on a fully amortized loan increases over time.

---

Definitions:

1800s

Refers to the 19th century, a period marked by significant social, economic, and technological changes worldwide.

Domesticated Cats

Cats that have been tamed and bred by humans as pets or for working purposes, adapting over thousands of years to live alongside humans.

Wild Lions

Wild lions are large feline predators that reside in various parts of Africa and a small region in India, known for their social structure and as a symbol of strength in various cultures.

Brain Sizes

Refers to the physical dimensions or volume of the brain, often considered in the context of its correlation with intelligence, cognition, or species differences.