Question

When comparing an annuity due to an ordinary annuity, an annuity due:

will always have lower present values and higher future values assuming equal payments, interest rates and terms.

will always have lower future values and higher present values assuming equal payments, interest rates and terms.

will always have lower future values and lower present values assuming equal payments, interest rates and terms.

will always have higher present values and higher future values assuming equal payments, interest rates and terms.

none of the above.

Answer #1

An annuity due makes payments at the beginning of every period. This results in a higher present value and a lower future value.

Comparatively, in an ordinary annuity, the payments are made at the end of the period. This results in a lower present value and a higher future value.

**When comparing an annuity due to an ordinary
annuity, an annuity due-**

**will always have lower future values and higher
present values assuming equal payments, interest rates, and
terms.**

*Do leave an upvote if you find this helpful. In case of any
doubt, please let me know in the comment section.*

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

Matt is considering purchasing one of two annuities. The first
annuity, an ordinary annuity, will pay $1,000 at the end of each
quarter for 20 years. The second annuity, an annuity due, will pay
$1,000 at the beginning of each quarter for 20 years. Which of the
following statements is correct regarding these annuities?
A. The present value of an ordinary
annuity is equal to the present value of an annuity due.
B. An ordinary annuity has a higher
future...

Present value of an ordinary annuity and annuity due.
Jill Morris is presently leasing a small business computer from
Eller Office Equipment Company. The lease requires 10 annual
payments of $6,000 at the end of each year and provides the lessor
(Eller) with an 8% return on its investment. You may use the
following 8% interest factors:
9 Periods
10 Periods
11 Periods
Future Value of 1
1.99900
2.15892
2.33164
Present Value of 1
.50025
.46319
.42888
Future Value of...

Present value of an ordinary annuity and annuity due. (Show your
work)
Jill Morris is presently leasing a small business computer from
Eller Office Equipment Company. The lease requires 10 annual
payments of $6,000 at the end of each year and provides the lessor
(Eller) with an 8% return on its investment. You may use the
following 8% interest factors:
9 Periods 10
Periods 11 Periods
Future Value of
1
1.99900
2.15892
2.33164
Present Value of
1
.50025
.46319 ...

Explain the meaning of this statement: Annuity due differs from
ordinary annuity. In case of annuity due, show the required change
in the future value and present value equations.

Present value of an ordinary annuity. Fill in the missing
present values in the following table for an ordinary annuity:
LOADING... . Number of Payments or Years Annual Interest Rate
Future Value Annuity Present Value 9 7% 0 $235.49
$nothing (Round to the nearest cent.)

Comparing current returns with future returns, without
accounting for the time value of money, will overstate the relative
value of the future returns.
True
False
The present value of an ordinary annuity is:
The amount that would be paid today in order to receive a
series of unequal payments in the future
The amount that would be paid today in order to receive a
series of equal payments in the future
The amount that would be paid in the future...

15.a Calculate the
FV of (a) an ordinary annuity and (b) an annuity due with payments
of $2,000 at the interest rate of 12% per year. (a)
$(
);
(b) $(
)
15.b Calculate the
PV of (a) an ordinary annuity and (b) the annuity due with 5
payments of $2,000 at the interest rate of 12%. (a)
$(
); (b)
$(
)
(Please hand write
and show all steps of the solution no Excel no typing I need to...

What is the difference of the future amounts of the annuity due
and ordinary annuity for regular quarterly payments of 14000 at 14%
compounded quarterly.
Please Solve As soon as
Solve quickly I get you UPVOTE directly
Thank's
Abdul-Rahim Taysir

What is an ordinary annuity? An annuity due? And a deferred
annuity? Be sure to discuss when the stream of payments will
occur.As an investor, if you had a choice of daily, monthly, or
quarterly compounding, which would you choose? Why?
The interest on your home mortgage is tax deductible. Why are
the early years of the mortgage more helpful in reducing taxes than
in the later years?

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 4 seconds ago

asked 20 minutes ago

asked 40 minutes ago

asked 43 minutes ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago

asked 1 hour ago