4. Future value of annuities II

There are three categories of cash flows: single cash flows, also referred to as lump sums, a stream of unequal cash flows, and annuities.

Based on your understanding of annuities, answer the following questions.

option:

Which of the following statements about annuities are true? Check all that apply. An annuity due is an annuity that makes a payment at the beginning of each period for a certain time period. Ordinary annuities make fixed payments at the beginning of each period for a certain time period. An annuity due earns more interest than an ordinary annuity of equal time. An annuity is a series of equal payments made at fixed intervals for a specified number of periods. Which of the following is an example of an annuity? O An investment in a certificate of deposit (CD) A lump-sum payment made to a life insurance company that promises to make a series of equal payments later for some period of time Latasha had a high monthly food bill before she decided to cook at home every day in order to reduce her expenses. She starts to save $1,100 every year and plans to renovate her kitchen. She deposits the money in her savings account at the end of each year and earns 12% annual interest. Latasha's savings are an example of an annuity. If Latasha decides to renovate her kitchen, how much would she have in her savings account at the end of 3 years, rounded to the nearest whole dollar? O $4,157 O $5,011 O $3,155 $3,712 by the end of 3 If Latasha deposits the money at the beginning of every year and everything else remains the same, she will save years? $5,196 $4,157 $2,784 $3,712 Kurt submits a report stating that the firm has $824,687 in available net cash flow, while Jake's report states that the firm has $621,562 in net cash flow. Based on the information given to them, which applicant has provided a better estimate of the company's current cash flows? Kurt Jake