You calculate the present value of an annuity due incorrectly by failing to put your calculator in BEGIN mode. What are the implications.

Question 7 options:

	There are none. This doesn't matter. All annuities have the same present value, regardless of the timing of payments.
	You overestimated the value of the annuity by assuming cash flows occur sooner on the timeline.
	You underestimated the value of the annuity by assuming cash flows occur later on the timeline.