1. TRUE or FALSE: "If you invest money for 10 years at 8% interest, compounded quarterly, you are effectively investing money for 40 three-month periods, during which you receive 4% interest each period." a. True b. False 2. TRUE or FALSE: "As the interest rate increases, the present value of future cash flows increases." a. True b. False 3. TRUE or FALSE: "If the interest rate is greater than 0%, a dollar today is worth more than a dollar tomorrow." a. True b. False 4. TRUE or FALSE: "As the number of compounding periods per year increases (e.g., from semi-annual compounding to monthly compounding), the present value of future cash flows increases." a. True b. False 5. TRUE or FALSE: "The rate of return on any perpetuity is equal to its present value divided by its annual cash flow." a. True b. False 6. TRUE or FALSE: "The present value of a future sum of money decreases as the number of years before the payment is received increases." a. True b. False 7. TRUE or FALSE: "In the amortization of a mortgage loan with equal payments, the fraction of each payment devoted to interest steadily decreases over time and the fraction devoted to reducing the loan balance increases with additional each payment made." a. True b. False