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1. The effective annual rate will increase as the number of compounding periods per year increases.
True
False
2. The time value of money means that a dollar today is worth less than a dollar at any time in the future.
3. The time value of money means that a dollar today is worth more than a dollar at any time in the future.
4. Present value factors for amounts are reciprocals of future value factors for amounts.
5. The present value factor is also known as the discount factor.
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