The distinguishing feature of an annuity due is that the time period between the payment of each successive cash flow differs to the frequency with which the interest compounds.

Question

Quizplus · Accepted Answer

The distinguishing feature of an annuity due is that the first cash flow occurs at the beginning of the period, rather than at the end as with a regular annuity. The time period between successive cash flows is the same, regardless of how frequently the interest compounds.

The Distinguishing Feature of an Annuity Due Is That the Time