Practice quiz

A series of equal payments occurring at equal interval of time, known as. Ans: ____________ A type of annuity where the first payment is made at the end of the first period. Ans: ___________________ A type of annuity whose sum is infinite. Ans: _____________ A type of annuity where the first payment is made at the beginning of the first period. Ans: ______________ A type of annuity where the first payment is made later after the end of the first period. Ans: ___________________

Which of the following is not true regarding an annuity due?   Select the correct response:   It is a series of equal cash flows.   Payments are made at the start of each period.   It is also known as deferred annuity   Cash flows occurs for a specific time.

Choose the letter of the correct answer and write it on the space provided _____ 1. A sequence of payments made at equal (fixed) intervals or periods of time. A. Annuity C. Ordinary Annuity B. Annuity due D. Simple Annuity ______2. The amount of each payment. A. Payment interval C. Annuity Payment B. Periodic Payment D. Time payment ______3. It is time between the purchase of an annuity and the start of the payments for the deferred annuity. A. Period of deferral C. Payment interval B. Annuity payment D. Period of payment ______4. A type of annuity in which the payments are made at the end of each payment interval. A. Annuity due C. General Annuity D. Simple Annuity D. Ordinary Annuity ______5. Compounding quarterly means the interest period is A. every year C. every 6 months B. every 4 months D. every 3 months ______6. In a monthly payment of P2,000 for 5 years that will start 7 months from now, what will be the period of deferral? A. 7 B. 5 C. 4 D. 6 ______7. A loan is given an…

Question 1 Saved An annuity with periodic payments made at the end of each payment period is called: A) ordinary Oi general Cannuity due O simple Onone of the above

An [Select] is a sequence of equal period payments. If payments are made at the end of each time interval, the annuity is called an [Select]

An even stream of payments over equal time periods where the interest rate is constant is referred to as a(n): a) Post-annuity. Ob) Annuity. c) Pre-annuity. d) Accumulated Annuity due.

In order to compute the present value of an annuity, it is necessary to know the 1. discount rate. 2. number of discount periods and the amount of the periodic payments or receipts. ○ 1 O something in addition to 1 and 2 O both 1 and 2 ○ 2

Which of the following statements about annuities are true? Check all that apply. An ordinary annuity of equal time earns less interest than an annuity due.   A perpetuity is a series of equal payments made at fixed intervals that continue infinitely and can be thought of as an infinite annuity.   When equal payments are made at the end of each period for a certain time period, they are treated as ordinary annuities.   When equal payments are made at the end of each period for a certain time period, they are treated as an annuity due.

Which of the following statements regarding annuities is FALSE? (1) A difference between an annuity and a perpetuity is that an annuity ends after some fixed number of payments. (II) When using the present value formula of perpetuity (C/r) to calculate the value at date 0, the first payment occurs at date 0. (III) When using the present value formula of growing perpetuity (C/(r-g)) to calculate the value at date 0, the first payment occurs at date 1 and doesn't include growth. (IV) In the growing perpetuity formula (C/(r-g)), g cannot be negative. (V) In the growing perpetuity formula (C/(r-g)), g can be greater than r. O A. II, III, IV, V O B. II O C. IV, V O D. II, IV, V O E. II, IV

Which of the following statements is CORRECT?   The cash flows for an annuity may vary from period to period, but they must occur at regular intervals, such as once a year.   The cash flows for an annuity due must all occur at the beginning of the periods.   The cash flows for an ordinary annuity occur at the beginning of the periods.   If some cash flows occur at the beginning of the periods while others occur at the ends, then we have what the textbook defines as an ordinary annuity.   If a series of unequal cash flows occurs at regular intervals, such as once a year, then the series is by definition an annuity.

An annuity due is one in which _____.   a. payments or receipts occur at the beginning of each period   b. payments or receipts occur at the end of each period   c. cash flows occur continuously   d. payments or receipts occur forever

6 [Question text] An ordinary annuity is best defined as __________________. Select one: A. increasing payments paid forever B. equal payments paid at the beginning of regular intervals for a limited time period C. equal payments paid at the end of regular intervals over a stated time period D. increasing payments paid for a definitive period of time

Which is NOT an essential element of an ordinary annuity?   Select the correct response:   The payments are made at equal interval of time.   The amounts of all payments are equal.   The first payment is made at the beginning of the first period.   Compound interest is paid on all amounts in the annuity.

A series of equal periodic payments in which the first payment is made one compounding period after the date of the contract is ________. Group of answer choices a deferred annuity a compound annuity an ordinary annuity an annuity due

1.     Which statement is FALSE?   A. Future value annuity is an example of annuity. B. A perpetuity is an annuity that has maturity period. C. An annuity is a series of equal payment made for a specified number of years. D. Ordinary annuity is an annuity in which the cash flows occur at the end of each period.

Which of the following statements is most likely correct? OA perpetuity is an infinite stream of payments in varying amounts occurring at regular time intervals. O The cash flows for an annuity can vary in amounts, and they can occur at irregular intervals. O Time periods that can be used in the time value of money computations are not restricted to months and years. O An annuity due has the first payment occurring one period from now, while an ordinary annuity has the first payment occurring now.

Select all the statements that apply to an ordinary annuity. The end of the annuity's term does not coincide with the last payment. The beginning of the annuity's term coincides with the first payment. The beginning of the annuity's term occurs one payment interval before the first payn The end of the annuity's term coincides with the last payment. Need help? Review these concept resources. (1]) Read About the Concept Rate your confidence to submit your answer.

Which of following formulas is used to calculate the present value of a perpetual annuity? Seleccione una: a. P= f / (1+i)^n b. P= f / (i - g) c. P= a / (i - g) d. P= a / (1+i)^n e. F = P * (1+i)^n

Which of the following statement is true? a) An ordinary annuity is an annuity in which the cash flow occurs at the start of each period   b) None of the above   c) A deferred annuity is an annuity in which the first cash flow occurs at the end of the time period between each subsequent cash flow   d) with a credit foncier loan ( a loan for a fixed period with regular repayments) as time passes a smaller proportion of each repayment goes to paying off the interest on the loan

The future value of an annuity due is determined one period after the first cash flow in the series. a.True b.False

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