Question

When comparing annuity due to ordinary annuities, annuity due annuities will have higher Select one A....

When comparing annuity due to ordinary annuities, annuity due annuities will have higher

Select one

A. Annuity amounts

B. Present and Future values

C. Present Value

D. Future Value

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Answer #1

Ans C. Present Value

Annuity PV Factor (End of Period) = P [ 1 - ( 1 + r )^-n ]
        r
4000* ( 1 - ((1 / (1 + 4%)^69)))
                     4%
3732.847293
0.04
93321.18
Annuity PV Due (Beginning)= P + ( P [ 1 - ( 1 + r )^-(n-1) ] /   r )
4000 + 4000 * ( 1 - ((1 / (1 + 4%)^(69-1))))/ (4%)
97054.03
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