Discounted at 10%, $1000 received at the end of each year for three years is worth less than $2,700 received today.

 In paying off a mortgage loan, the amount of the periodic payment that goes toward the reduction of principal increases over the life of the mortgage.

TRUE

The time value of money concept becomes less critical as the prime rate increases.

FALSE

Discounted at 10%, $1000 received at the end of each year for three years is worth less than $2,700 received today.
TRUE

PV_A = A ´PV_IFA (App. D: 3 periods, 10%)
= $1,000 ´ .2.487 = $2,487

 When adjusting for semi-annual compounding of an annuity, the adjustments include multiplying the periods and annuity by 2.

FALSE

Calculation of the yield of an investment provides the total return over multiple years.

FALSE