Which of the following statements is CORRECT?
A) A time line is not meaningful unless all cash flows occur annually.
B) Time lines are useful for visualizing complex problems prior to doing actual calculations.
C) Time lines cannot be constructed in situations where some of the cash flows occur annually but others occur quarterly.
D) Time lines cannot be constructed for annuities where the payments occur at the beginning of the periods.
E) Some of the cash flows shown on a time line can be in the form of annuity payments,but none can be uneven amounts.

Question

Quizplus · Accepted Answer

Time lines are a useful tool for visualizing and simplifying complex problems before actual calculations are performed. They can be constructed for any frequency of cash flows including annuities and uneven amounts. However, it is important to properly label and distinguish between different types of cash flows on the time line.

Which of the Following Statements Is CORRECT