In regard to an annuity,if the first cash flow is made immediately,it becomes:
A) a simple annuity.
B) an ordinary annuity.
C) an annuity due.
D) the present value of an annuity.

Question

Quizplus · Accepted Answer

An annuity due is a type of annuity where the first cash flow is made immediately. This is different from an ordinary annuity, where the first cash flow is made at the end of the first period. A simple annuity is a type of annuity where the payment is made at regular intervals, but the interest rate is not compounded. The present value of an annuity is the current value of a series of payments to be made in the future.

In Regard to an Annuity,if the First Cash Flow Is