Which of the Following Statements Is Correct

question 122

Multiple Choice

Which of the following statements is correct?

• A) If a bank uses quarterly compounding for saving accounts,the simple rate will be greater than the effective annual rate.
• B) The present value of a future sum increases as the simple interest rate increases or the number of discount periods per year decreases.
• C) The present value of a future sum increases as either the simple interest rate or the number of discount periods per year increases.
• D) The present value of a future sum decreases as either the simple interest rate or the number of discount periods per year increases.
• E) All of the above statements are false.