Question 12 A series of equal periodic payments that starts more than one period after the...
Question 12
A series of equal periodic payments that starts more than one period after the agreement is called:
A) An annuity due
B) An ordinary annuity
C) A future annuity
D) A deferred annuity
Homework Answers
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Option D is the answer. A deferred annuity |
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Deferred annuity is an annuity contract in which the contract delays the receipt of lump-sum or installment until the period the investor delays them. Comment if you face any issues |
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Question 12 A series of equal periodic payments that starts more than one period after the...
A series of equal periodic payments in which the first payment is made one compounding period...
A series of equal periodic payments in which the first payment is made one compounding period after the date of the contract is O A. an annuity due OB. a deferred annuity O c. an ordinary annuity OD. a compound annuity
What is an annuity? Select one: a. present worth of a series of equal payments. b....
What is an annuity? Select one: a. present worth of a series of equal payments. b. a single payment. c. a series of payments that changes by a constant amount from one period to the next. d. a series of equal payments over a sequence of equal periods. e. a series of payments that changes by the same proportion from one period to the next. Question 2 The present worth factor Select one: a. gives the future value equivalent to...
23. An ordinary annuity is best defined as: A) increasing payments paid for a definitive period o...
23. An ordinary annuity is best defined as: A) increasing payments paid for a definitive period of time. B) increasing payments paid forever C) equal payments paid at the end of regular intervals over a stated time period. D) equal payments paid at the beginning of regular intervals for a limited time period. E) equal payments that occur at set intervals for an unlimited period of time 24. A perpetuity is defined as: A) a limited number of equal payments...
e cumulative annuity payments over that time period Use the siders to change the irnterest rate,...
e cumulative annuity payments over that time period Use the siders to change the irnterest rate, the payment per period, or the number of The upper (red) line depicts the future value of the ordinary annuity for the specifed time period The lower (blue) ine depicts perlods and observe how the future value of the annuity changes. $1000.050-S315.25 FVAy PMT Future Value of Annuity 500 400 300 200 101 Period Int 5 10 PMT 100 200 400 N-3 5 10...
Question 15 Annuities where the payments occur at the beginning of each time period are called...
Question 15 Annuities where the payments occur at the beginning of each time period are called whereas refer to annuity streams with payments occurring at the end of each time period. O ordinary (or regular) annuities; annuities due O annuities due: ordinary (or regular) annuities O late annuities; straight annuities ordinary annuities; early annuities O straight annuities; late annuities mSi フ 8
Jenks Company financed the purchase of a machine by paying $37,000 a year for the next...
Jenks Company financed the purchase of a machine by paying $37,000 a year for the next five years, with the first payment due one year from today. The purchase cost of the machine is considered to be the present value of those payments. What was the purchase cost of the machine to Jenks assuming a discount rate of 7%? (Use spreadsheet software or a financial calculator to calculate your answer. Do not round any intermediary calculations, and round your final...
Annuity payments are assumed to come at the end of each payment period (termed an ordinary...
Annuity payments are assumed to come at the end of each payment period (termed an ordinary annuity). However, an exception occurs when the annuity payments come at the beginning of each period (termed an annuity due). What is the future value of a 14-year annuity of $2,200 per period where payments come at the beginning of each period? The interest rate is 12 percent. Use Appendix C for an approximate answer, but calculate your final answer using the formula and...
Instructions: a. Match each question with the method listed below that would be used in providing...
Instructions: a. Match each question with the method listed below that would be used in providing a solution. b. Compute the answer to each of the following questions listed below and on the right. Method A. Present Value or Future Value of a Single Sum B. Future Value of an Ordinary Annuity C. Future Value of an Annuity Due D. Present Value of an Ordinary Annuity E. Present Value of an Annuity Due F. Present Value of a Deferred Annuity...
For a sum of money invested at 11.8% compounded quarterly for 10 years state the following...
For a sum of money invested at 11.8% compounded quarterly for 10 years state the following values a) the number of compounding periods b) the periodic rate of interest (c) the compounding factor (1 + i)n (d) the numerical value of the compounding factor (a) The number of compounding periods is 4 (Type an integer or a decimal.) (b) The periodic rate of interest is %. (Round to six decimal places as needed.) A (C) The compounding factor is (1+...
Which of the following statements is INCORRECT? A) In general, money today is worth more than...
Which of the following statements is INCORRECT? A) In general, money today is worth more than money in one year. B) We define the risk-free interest rate, rf for a given period as the interest rate at which money can be borrowed or lent without risk over that period. C) We refer to (1 - rf) as the interest rate factor for risk-free cash flows. D) For most financial decisions, costs and benefits occur at different points in time. Suppose...
A series of equal periodic payments in which the first payment is made one compounding period after the date of the contract is O A. an annuity due OB. a deferred annuity O c. an ordinary annuity OD. a compound annuity
23. An ordinary annuity is best defined as: A) increasing payments paid for a definitive period of time. B) increasing payments paid forever C) equal payments paid at the end of regular intervals over a stated time period. D) equal payments paid at the beginning of regular intervals for a limited time period. E) equal payments that occur at set intervals for an unlimited period of time 24. A perpetuity is defined as: A) a limited number of equal payments...
e cumulative annuity payments over that time period Use the siders to change the irnterest rate, the payment per period, or the number of The upper (red) line depicts the future value of the ordinary annuity for the specifed time period The lower (blue) ine depicts perlods and observe how the future value of the annuity changes. $1000.050-S315.25 FVAy PMT Future Value of Annuity 500 400 300 200 101 Period Int 5 10 PMT 100 200 400 N-3 5 10...
Question 15 Annuities where the payments occur at the beginning of each time period are called whereas refer to annuity streams with payments occurring at the end of each time period. O ordinary (or regular) annuities; annuities due O annuities due: ordinary (or regular) annuities O late annuities; straight annuities ordinary annuities; early annuities O straight annuities; late annuities mSi フ 8
Jenks Company financed the purchase of a machine by paying $37,000 a year for the next five years, with the first payment due one year from today. The purchase cost of the machine is considered to be the present value of those payments. What was the purchase cost of the machine to Jenks assuming a discount rate of 7%? (Use spreadsheet software or a financial calculator to calculate your answer. Do not round any intermediary calculations, and round your final...
For a sum of money invested at 11.8% compounded quarterly for 10 years state the following values a) the number of compounding periods b) the periodic rate of interest (c) the compounding factor (1 + i)n (d) the numerical value of the compounding factor (a) The number of compounding periods is 4 (Type an integer or a decimal.) (b) The periodic rate of interest is %. (Round to six decimal places as needed.) A (C) The compounding factor is (1+...
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