Question
1) Assuming that the frequency of capitalization in compounded interest is quarterly , select the true statement for which the present value of simple interest
1) Assuming that the frequency of capitalization in compounded interest is quarterly, select the true statement for which the present value of simple interest is the same as compound:
a. the relationship t=1/m is sufficient
b. at the same nominal interest rate and capital, the frequency of capitalization and time to equalise future values are related by: t=1/m equation
c. this can never happen
d. it is sufficient that only the capitals are equal and no other conditions are needed
2) Assuming that the frequency of capitalization in compounded interest is monthly, select the true statement for which the future value of simple interest is the same as compound:
a. the relationship t=1/m is sufficient
b. at the same nominal interest rate and capital, the frequency of capitalization and time to equalise future values are related by: t=1/m equation
c. this can never happen
d. it is sufficient that only the capitals are equal and no other conditions are needed
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School Finance A Policy Perspective
Authors: Allan Odden, Lawrence Picus
6th Edition
1259922316, 9781259922312
