Which type of annuity ordinary or annuity due-is preferable

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Reference no: EM131111417

Present value of an annuity Consider the following cases.

a. Calculate the present value of the annuity assuming that it is

(1) An ordinary annuity.

(2) An annuity due.

b. Compare your findings in parts a(1) and a(2). All else being identical, which type of annuity-ordinary or annuity due-is preferable? Explainwhy.

Reference no: EM131111417

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