Multiple Response Identify one or more choices that best complete the statement or answer the question.

1. Choose ALL statements that are correct.

a. A bi-weekly compounding frequency means interest is added 26 times during a year.

b. Simple interest shows a linear relation between time and the amount of an investment.

c. When calculating the simple interest earned on an investment for 40 weeks, we substitute t = 40 into the simple interest formula.

d. Compound interest refers to interest that is calculated at regular compounding periods.

e. The number of compounding periods for a quarterly compounding for of a year is 0.75.

2. Choose ALL statements that are correct.

a. By law, mortgage interest rates must be stated as an annual rate compounded annually.

b. The term future value always refers to events that will happen in the future.

c. The following is an example of regular withdrawal: withdrawing $300 every three months from a savings account.

d. An annuity is an investment in which regular payments are deposited into or withdrawn from an account.

e. Monthly payment of mortgage can be calculated using the Present Value of an Ordinary Simple Annuity Formula.