All other things held constant, the present value of a given annual annuity decreases as the number of periods per year increases.

Question

Quizplus · Accepted Answer

One could make up an example and see that the statement is true.Alternatively, one could simply recognize that the PV of an annuity declines as the discount rate increases and recognize that more frequent compounding increases the effective rate.

All Other Things Held Constant, the Present Value of a Given