ESTION 12

Using the future value table, a student found that the future value amount of $1 for 5 years at an annual interest rate of 10% is 1.611. The student also observed that the future value of $1 for 5 years at 10% compounded semiannually is 1.629. This means that

	A.	a. the more often the compounding, the higher the future value.
	B.	the student was looking in the wrong column; the second amount should be 1.611/2.
	C.	there was an error in the table.
	D.	when interest is compounded semiannually, more money must be deposited to have a desired ending balance.