Answer the True or False Questions Based on Interests

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Business Finance

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True or False

  1. True or false. When simple interest is used, the accumulated amount is a linear function of time.
  2. True or false. Compound interest that is converted once a year is the same as simple interest.
  3. True or false. If interest is compounded annually, then the effective rate of interest is the same as the nominal rate of interest.
  4. True or false. The present value is always smaller than the future value.
  5. True or false. The future value of an annuity can be found by adding together all the payments that are paid into an account.
  6. True or false. The periodic payment R where 20140305032806equation.png and P is the loan amount and i is the interest per period that will amortize the loan at the end of the term comprising periods.
  7. True or false. A sinking fund is the accumulated amount to be realized at some future date (the end of the term) when a fixed number of periodic payments are paid into an account earning interest at the rate of i per period.

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Anonymous
Just what I was looking for! Super helpful.

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