Question 1 (0.2 points) Jack earned $120 in interest on his savings account last year. He has decided to leave the $120 in his account so that he can earn interest on the $120 this year. This process of earning interest on prior interest earnings is called: O 1) compounding. O2) duplicating. O3) discounting. O 4) indexing. O5) multiplying. Question 2 (0.2 points) Which of the following characteristics apply to a perpetuity? I. Constant cash flow dollar amount II. Unequal cash flow dollar amount III. Infinite time period IV. Limited time period 0 1) II and Ill only 2) I and III only O 3) || and IV only O 4) I plus either Ill or IV 5) | and IV only View hint for Question 2