Which of the following provides the greatest annual interest and highest future value?
I. 15% compounded annually
II. 15% compounded semiannually
III. 15% compounded monthly
IV. 15% compounded weekly
V. None of the above
b. If you have $10,000 to invest today, which of the following will give you highest future value?
I. 10% per year, compounded annually
II. 10% per year, compounded semiannually
III. 10% per year, compounded quarterly
IV. 10% per year, compounded daily c.
In calculation of time value of money, the frequency of compounding the interest rate has a _________ relationship to the present value and _________ relationship to the future value of an investment.
positive; positive
negative; positive
negative; negative
positive;negative