Test your knowledge of annuities.
Click the box below each question to see the correct answer. Keep track of how many you answer correctly and compare the total to the grading scale found at the bottom of the page.
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0 1 2 3 4 5 6 Time line |--------|--------|--------|--------|--------|--------| $10 $10 $10 $10 $10 Cash flows ¦ ¦ A B The present value of the 5-period annuity shown above as of Point A is the present value of a 5-period ______________ , whereas the future value of the same annuity as of Point B is the future value of a 5-period ______________ . A. ordinary annuity; ordinary annuity. B. ordinary annuity; annuity due. C. annuity due; annuity due. D. annuity due; ordinary annuity.
0 1 2 3 4 5 6 Time line |--------|--------|--------|--------|--------|--------| $10 $10 $10 $10 $10 ¦ Cash flows ¦ ¦ A B The present value of the 5-period annuity shown above as of Point A is the present value of a 5-period ______________ , whereas the future value of the same annuity as of Point B is the future value of a 5-period ______________ . A. ordinary annuity; ordinary annuity. B. ordinary annuity; annuity due. C. annuity due; annuity due. D. annuity due; ordinary annuity.