Annuity Due. Recall that an annuity due is like an ordinary annuity except that the first payment

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Annuity Due. Recall that an annuity due is like an ordinary annuity except that the first payment is made immediately instead of at the end of the first period.

a. Why is the present value of an annuity due equal to (1 + r) times the present value of an ordinary annuity?

b. Why is the future value of an annuity due equal to (1 + r) times the future value of an ordinary annuity?

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Study Guide To Accompany Fundamentals Of Corporate Finance

ISBN: 9780073012421

5th Edition

Authors: Richard Brealey, Stewart Myers, Alan Marcus

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Question Posted: Jun 05, 2024 02:01 AM

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Annuity Due. Recall that an annuity due is like an ordinary annuity except that the first payment

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Study Guide To Accompany Fundamentals Of Corporate Finance

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