Question
Annuity Alpha pays $500 at the end of each month for 15 years. Annuity Beta pays $500 at the beginning of each month for 15
Annuity Alpha pays $500 at the end of each month for 15 years. Annuity Beta pays $500 at the beginning of each month for 15 years. The rate of return on both annuities is 10%. Which one of the following statements is correct given this information?
A. Annuity B has both a higher present value and a higher future value than Annuity A.
B. The present value of Annuity A is equal to the present value of Annuity B.
C. Annuity B will pay one more payment than Annuity A will.
D. The future value of Annuity A is greater than the future value of Annuity B.
E. Annuity A has a higher future value but a lower present value than Annuity B.
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