Topic

Annuity (Due Vs Ordinary)

Instructions

Read Ch. 14 of Business Math.

Consider the following as you read and write a post:

The difference between ordinary annuities and annuities due.
How to use Excel^® to evaluate annuities.

Answer preview

An annuity is a series of payments that are paid at regular periods. Popular examples of annuities include money paid regularly to settle a mortgage, insurance payments made monthly, and savings into a 401K account. There are two types of annuities, namely annuities due, and ordinary annuities. The main difference between the two is the point at which each is paid in a given period. Annuities due are usually paid at the beginning of a given period. On the other hand, an ordinary annuity is paid at the end of a given period.

Word count: 215