Question
Which of the following statements is CORRECT? A.) You are considering to invest in an annuity. You conclude that the present value of a 4-year,
Which of the following statements is CORRECT?
A.) You are considering to invest in an annuity. You conclude that the present value of a 4-year, $400 ordinary annuity will exceed the present value of a 4-year, $400 annuity due.
B.) You are investing in a fund that offers a nominal annual rate of 5%. Its effective rate will never be less than 5%.
C.) You are investing in a fund that offers annual interest payments. Its effective, periodic, and nominal rates of interest will all be different.
D.) You are investing in a fund that offers a nominal rate of 4% with semi-annual payments. Its effective rate that is smaller than 4%.
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