You are comparing two annuities. Annuity A pays $100 at the end of each year for 5 years. Annuity B pays $100 at the beginning of each year for 5 years. The rate of return on both annuities is 6 percent. Which one of the following statements is correct given this information?

1. Annuity B has both a higher present value and a higher future value than Annuity A.

2. Annuity B has a higher future value than Annuity A, but a lower present value than Annuity A.

3. Annuity A has a higher future value than Annuity B, but a lower present value than Annuity B.