Which of the following statements is CORRECT? A time line is not meaningful unless all cash flows occur annually. Time lines are not useful for visualizing complex problems prior to doing actual calculations Time lines cannot be constructed to deal with situations where some of the cash flows occur annually but others occur quarterly. Time lines can only be constructed for annuities where the payments occur at the end of the periods, i.e., for ordinary annuities. Time lines can be constructed where some of the payments constitute an annuity but others are unequal and thus are not part of the annuity. C. Your bank account pays a 6% nominal rate of interest. The interest is compounded quarterly. which of the following statements is CORRECT? The periodic rate of interest is 1.5% and the effective annual rate of interest is 3% The periodic rate of interest is 6% and the effective rate of interest is greater than 6%. The periodic rate of interest is 1.5% and the effective rate of interest is greater than 6%. The periodic rate of interest is 3% and the effective rate of interest is 6%. The periodic rate of interest is 6% and the effective rate of interest is also 696. C. You plan to analyze the value of a potential investment by calculating the sum of the present values of its expected cash flows. Which of the following would reduce the calculated value of the investment? The cash flows are in the form of an annuity. The cash flows they total to $100,000. u learn that the annuity lasts for only 5 rather than 10 years, hence each annuity payment is $20,000 rather than $10,000. The discount rate increases b. iness of the investment's cash flows decreases The total amount of cash flows remains the same, but more of the cash flows are ed in the earlier years and less are received in the later years of the following statements is CORRECT, assuming positive interest rates and holding other things constant? A 30-year, $150,000 amortized mortgage will have larger monthly payments than an otherwise similar 20-year mortgage. A bank loan's nominal interest rate will always be equal to or greater than its effective a. annual rate an investment pays 10% interest, compounded quarterly, its effective annual rate will be greater than 10%. Banks A and B offer the same nominal annual rate of interest, but A pays interest quarterly and B pays semiannually. Deposits in Bank B will provide the higher future value if you leave your funds on deposit d