Most loans are a form of perpetuity

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Which statement is TRUE?

PV of annuity due is always smaller than the PV of ordinary annuity (assuming interest rate is greater than 0).

FV of annuity due is larger than the FV of ordinary annuity (assuming interest rate is greater than 0).

A perpetuity composed of $100 monthly payments is worth less than an annuity of $100 monthly payments given equal discount rates.

PV of growing perpetuity cannot be calculated since the relevant cash flows grow forever.

Most loans are a form of perpetuity.

Reference no: EM13877951

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