Question 20 Annuity Due is a type of annuity wherein the payment is made at the beginning of each period. A True False
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- An annuity due is an annuity for which: Question 10 options: A) the payments are made to repay a loan B) the payments are made at the beginning of each payment period C) the payments continue forever D) the payments are made at the end of each payment period E) the payment period is not the same as the conversion periodAnnuity due is an annuity whose payment is due at the END of each period. TRUE OR FALSE?Question 15 Annuities where the payments occur at the beginning of cach time period are called ahereas refer to annuity streams with payments occurring at the end ofexhine period O ordinary for regular) annuities annuities due O annuities due, ordinary lor regulari annutles OLte anouties straight anuities ordinany annuities carly annuities straight annuities, late annuities
- [Question 6 An ordinary annuity is best defined as __________________. Select one: A. equal payments paid at the end of regular intervals over a stated time period B. increasing payments paid for a definitive period of time C. increasing payments paid forever D. equal payments paid at the beginning of regular intervals for a limited time periodAn annuity with payments that occur at the beginning of each period is known as a ○ annuity due ordinary annuity deferred annuity discounted annuity immediate annuityAn annuity due is one in which _____. a. payments or receipts occur at the beginning of each period b. payments or receipts occur at the end of each period c. cash flows occur continuously d. payments or receipts occur forever
- Annuities where the payments occur at the beginning of each time period arecalled refer to annuity streams with payments occurring at the end of each ine period. where O ordinary lor regular) annuities annuities due annuities due, ordinary (or regularl annuities O ute annuitie straight annuties straight annuities late aonuitiesIn this type of annuity, payment is made at the end of each period starting from the first period. ordinary annuity annuity due deferred annuity perpetuityType of annuity that is made at the end of each period Perpetuity Annuity Due Ordinary Annuity Deferred Annuity
- 6. Present Value of an Annuity The table below contains information on four different annuities. a) Calculate the present value of each annuity if it is i) An ordinary annuity ii) An annuity due b) Compare your findings. All else being identical, which type of annuity-ordinary annuity or annuity due-is preferable? Why? Part Annual CF Interest Rate Deposit Period A $12,000 B $52,000 C $20,000 D $24,000 8% 10% 6% 12% (Years) 8 15 20 8The ___________ of an annuity is the amount that must be invested now at interest rate i per time period to provide n payments each of amount R.An [Select] is a sequence of equal period payments. If payments are made at the end of each time interval, the annuity is called an [Select]