There are multiple factors that affect the value of an annuity. Explain what these four factors are and discuss how a change in each factor will impact both the present value and the future value of the annuity.
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The factors are the interest rate, payment amount, payment timing (beginning or end of period), and number of payments. An increase in either the payment amount or the number of payments will increase both the present value and the future value of the annuity. An annuity due (payment at beginning of period) will have a higher present value and a higher future value than a comparable ordinary annuity (payment at end of period). An increase in the interest rate will decrease the present value but increase the future value.
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Indicate whether the statement is true or false
Bill Burns, district manager of the Pizza Palace, wishes to locate a new store in the metropolitan areas
Using the following information, what are the x and y coordinates for the center of gravity? Don't round your answer up or down before making your choice. Market Demand (pizzas/day) x coordinate y coordinate Grandview Heights 250 2 2 Upper Arlington 100 4 5 Bexley 150 7 3 Worthington 350 4 9 Medfield 500 4 3 A) x is less than or equal to 4; y is less or equal to than 4.5. B) x is greater than or equal to 5; y is greater than or equal to 3.5. C) x is less than or equal to 3.5; y is less than or equal to 4.5. D) x is less than or equal to 4; y is greater than or equal to 4.5.
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What will be an ideal response?
A corporation issued 8% bonds with a par value of $1,000,000, receiving a $20,000 premium. On the interest date 5 years later, after the bond interest was paid and after 40% of the premium had been amortized, the corporation called the bonds at $990,000. The gain or loss on this retirement is:
A. $22,000 gain. B. $22,000 loss. C. $10,000 gain. D. $10,000 loss. E. $0.