Which of the Following Statements Is Correct

question 13

Multiple Choice

Which of the following statements is correct?

• A) Other things held constant, an increase in the number of discounting periods per year increases the present value of a given annual annuity.
• B) Other things held constant, an increase in the number of discounting periods per year increases the present value of a lump sum to be received in the future.
• C) The payment made each period under an amortised loan is constant, and it consists of some interest and some principal.The later we are is the loan's life, the smaller the interest portion of the payment.
• D) There is an inverse relationship between the present value interest factor of an annuity and the future value interest factor of an annuity, (i.e., one is the reciprocal of the other).
• E) Each of the above statements is true.

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Definitions:

Imprisoned

Confined or detained in prison as a form of punishment or preventive measure.

Lifetime Appointments

Positions or titles that are held for the individual's lifetime, often used in the context of judicial appointments.

Judges

Officials appointed or elected to decide cases in a court of law.

Inductive Reasoning

A method of reasoning in which the premises are viewed as supplying some evidence, but not full assurance, of the truth of the conclusion.