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If the Present Value Annuity Factor Is 3

question 80

Multiple Choice

If the present value annuity factor is 3.8896, what is the present value annuity factor for an equivalent annuity due if the interest rate is 9 percent?


Definitions:

Ordinary Annuity

An annuity where the payments are made at the end of each period for a fixed length of time.

Financial Calculator

A specialized calculator used for financial matters, including calculating interests, loans, investments, amortization, and profit and loss.

Compounded Annually

Interest that is calculated and added to the principal balance once a year.

Compounded Monthly

Involves the addition of interest to the principal sum of a loan or deposit on a monthly basis.

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