Question

For any discount​ rate, the future value of an ordinary annuity factor for n periods is equal to the future value of an annuity due factor for n  minus 1 periods plus 1.

Answer 1

The above statement is incorrect,

Correct statement will be,

For any discount rate, the future value of an ordinary annuity factor for n periods is equal to the value of an annuity due facotor for n periods divided by (1+ discount rate).

Future value of annuity due Factor= (1+i)*{(1+i)ⁿ-1}/i

Future value of ordinary annuity factor= {(1+i)ⁿ-1}/i

From the above formulas,we can brought; future value of ordinary annuity factor=

Future value of annuity due factor/ (1+i)