PLEASE ANSWER 1,2,3,4 amd 5 PLEASE

Assignment: Keep the answers short and precise (3-4 sentences). You might not find all the answers in lecture or book. Googling the unknown terms will be very useful. 1. True/False (Explain): Effective interest rate is always higher than the corresponding nominal interest rate. 2. Which of the following cash flow stream would you choose? Which one would be your last choice? Why? (make sure that your decision makes financial sense) Period 1 2 3 4 Option 1 1000 1000 2000 4000 Option 2 2000 2000 2000 2000 Option 3 4000 2000 1000 1000 Option 4 6000 2000 0 0 3. Nemo is considering buying a cell phone. He can either pay $600 now or make 12 equal monthly payments of $50. Which option would you suggest him? Why? 4. Under what conditions does the effective annual rate of interest (EAR) differ from the annual percentage rate (APR)? 5. As the frequency of compounding increases within the annual period, what happens to the relation between the EAR and the APR