You are comparing two annuities which offer quarterly payments of $2,500 for five years and pay 0.75 percent

Which one of the following terms is used to describe a loan wherein each payment is equal in amount and includes both interest and principal?    A.  amortized loan B.  modified loan C.  balloon loan D.  pure discount loan E.  interest-only loan Refer to section 6.4

10.

Which one of the following terms is defined as a loan wherein the regular payments, including both interest and principal amounts, are insufficient to retire the entire loan amount, which then must be repaid in one lump sum?    A.  amortized loan B.  continuing loan C.  balloon loan D.  remainder loan E.  interest-only loan Refer to section 6.4

11.

You are comparing two annuities which offer quarterly payments of $2,500 for five years and pay 0.75 percent interest per month. Annuity A will pay you on the first of each month while annuity B will pay you on the last day of each month. Which one of the following statements is correct concerning these two annuities?    A.  These two annuities have equal present values but unequal futures values at the end of year five. B.  These two annuities have equal present values as of today and equal future values at the end of year five. C.  Annuity B is an annuity due. D.  Annuity A has a smaller future value than annuity B. E.  Annuity B has a smaller present value than annuity A. Refer to section 6.2