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Questions and Answers
An annuity due has a longer payment period compared to an ordinary annuity.
False
The present value of an annuity due is always lower than that of an ordinary annuity, assuming the same cash flows and interest rate.
False
The cash flows in an annuity due are delayed by one period compared to an ordinary annuity.
False
An annuity due and an ordinary annuity have the same present value if they have the same cash flows and interest rate.
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The timing of cash flows in an annuity due is the same as that of an ordinary annuity.
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