Question
please check the Solutions and correct me if there is ant answer wrong. Thank you Tutor 21- In loan amortization, does the ratio of principal
please check the Solutions and correct me if there is ant answer wrong. Thank you Tutor
21- In loan amortization, does the ratio of principal to interest in each equal payment increase or decrease with time?
Increases.
22- Are the number of compoundings per year (conversions) and number of payments per year equivalent in a general annuity?
No, they are not equivalent. In general annuities the conversion period and the payment interval are not equal.
23- Is there is a calculation for the future value of a perpetuity?
No. A perpetuity is an annuity for which the payments continue forever
24- In solving an ordinary general annuity calculation, what interest rate is used?
equivalent rate of interest per payment period
25- For an ordinary annuity with semi-annual payments, if the payments began on April 1, 2012, when will the seventh payment be made?
April 1, 2015th is the seventh payment.
26- If the prevailing market interest rate increases, does the purchase price of an annuity decrease or increase?
Increase
27- When calculating the future value of an annuity due, is the end date at the beginning or end of the last payment interval?
An annuity due is an annuity where the payments are made at the beginning of the last payment interval.
28- For a given n, PMT and i, is the present value of a deferred annuity the same as the present value of an ordinary annuity?
No its not the same.
29- Does a portability clause in the mortgage agreement mean that a purchaser may acquire the existing mortgage?
Yes.
30- In a deferred annuity, is the original value or the future value used to calculate payments that commence at the end of the deferral period?
Future Value is used to calculate.
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