You Are Considering Two Equally Risky Annuities, Each of Which

question 117

Multiple Choice

You are considering two equally risky annuities, each of which pays $25,000 per year for 10 years.Investment ORD is an ordinary (or deferred) annuity, while Investment DUE is an annuity due.Which of the following statements is CORRECT?

• A) If the going rate of interest decreases from 10% to 0%, the difference between the present value of ORD and the present value of DUE would remain constant.
• B) A rational investor would be willing to pay more for DUE than for ORD, so their market prices should differ.
• C) The present value of DUE exceeds the present value of ORD, while the future value of DUE is less than the future value of ORD.
• D) The present value of ORD exceeds the present value of DUE, and the future value of ORD also exceeds the future value of DUE.
• E) The present value of ORD exceeds the present value of DUE, while the future value of DUE exceeds the future value of ORD.

Comprehend the importance of Quality and Safety Education for Nurses (QSEN) competencies in improving care quality.

Acknowledge the impact of external forces such as healthcare reform, demographics, and emergencies on nursing practice.

Understand the importance of continuing education and training in enhancing nursing practice and patient care.

Realize the importance and attributes of a profession including extended education and a theoretical body of knowledge.

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Definitions:

Reflexively

In a manner that involves or denotes an action performed as a reflex, without conscious thought, or as a response to oneself.

Excrete

The process by which living organisms remove waste materials from their bodies.

Permanent Cessation

The irreversible end of an activity, function, or existence; often used in reference to the cessation of biological life or specific bodily functions.