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

Question

Quizplus · Accepted Answer

Time lines can be constructed for annuities where the payments occur at either the beginning or the end of the periods. Statement A is incorrect as cash flows can be uneven amounts. Statement B is incorrect as time lines can be used for any frequency of cash flows. Statement C is incorrect as time lines are useful for visualizing problems before doing calculations. Statement D is incorrect as time lines can be constructed for any frequency of cash flows.

Which of the Following Statements Is CORRECT