What difference does it make ordinary annuities, Financial Management

Assignment Help:

If you are doing PVA and FVA problems, what difference does it make if the annuities are "ordinary annuities" or "annuities due"?

In PVA or a FVA of annuity due trouble, annuity expenditure earning interest one period sooner than in ordinary annuity trouble thus, higher PVA and FVA values result with an annuity due. The first payment takes place sooner in the case of a future value of an annuity due. In current value of annuity due problems, each annuity payment takes place one period sooner, so the payments are discounted fewer severely.

 


Related Discussions:- What difference does it make ordinary annuities

Mortgages, A mortgage may be defined as a pledge of property ...

A mortgage may be defined as a pledge of property to secure a debt payment; in this context, we will use the term property to mean real estate. If the

Capital budgeting, #how to calculate initial investment cash flows ..

#how to calculate initial investment cash flows ..

Impact of the yield level in bonds, Different bonds trade at differen...

Different bonds trade at different yields though the coupon rate, maturity, and embedded options are same for them. Assuming that all the other bond characteristi

De-leveraged floaters, A floater where the coupon rate is computed as...

A floater where the coupon rate is computed as a fraction of the reference rate plus a quoted margin, are known as a de-leveraged floater. The general formula for this

Alternative dividend policies, The managing directors of three profitable l...

The managing directors of three profitable listed companies discussed their companies'' dividend policies at a business lunch. Company A; has deliberately paid no dividends for th

Valuing debt securities, Valuing Debt Securities Securities which promi...

Valuing Debt Securities Securities which promise to pay its investors a stated rate of interest and return principal amount at the maturity date are known as debt securities.

Distinguish between a credit card and a debit card, QUESTION (a) What a...

QUESTION (a) What are the main benefits of E-Banking to customers and banking institutions? (b) Internet Banking products and services are of two primary types, informationa

Capital structure, Modi Wires and Cable Ltd intends to finance its INR 20 m...

Modi Wires and Cable Ltd intends to finance its INR 20 million modernization plan for which it is trying to decide between debt and external equity. The management feels that the e

Determine the cost, a) Social marketing is the use of normal marketing meth...

a) Social marketing is the use of normal marketing methods to achieve the benefits of social change, such as informing the public about the harm of under-age drinking, rather than

Net present value of of the investment, Air Manchester (AM) is a new ...

Air Manchester (AM) is a new airplane manufacturer. It is considering investing in a software package, e.g. SAS, which would make its daily operations more efficient

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd