PARTI: MULTIPLE CHOICE - Choose the letter of the most correct answer for each question. Record only one answer per question. 1. In which case will an investor receive the most interest: a. 10%, compounded annually. b. 10%, compounded monthly. c. 10%, compounded continuously. d. 10%, compounded daily. e. There is not enough information provided to correctly answer this question. a. c. e. a. 2. An annuity is: a stream of equal payments at unequal time intervals. b. a stream of equal payments at equal time intervals. a stream of equal payments that continue forever. d. all of the above. none of the above. 3. A perpetuity is: a stream of equal payments at unequal time intervals. b. a stream of equal payments at equal time intervals. a stream of equal payments that continue forever. d. all of the above. e. none of the above. 4. The basic rule of the time value of money (assuming positive interest rates) is: a. investments will always be worth more tomorrow than they are today. b. it's always wiser to save a dollar for tomorrow than to spend it today. a dollar in hand today is worth more than a dollar promised at some time in the future. d. All of the statements above express an aspect of the basic rule of time value of money. None of the statements above represent the basic rule of the time value of money. c. c. e