If the Future Value of an Ordinary, 11 Year Annuity

question 78

Multiple Choice

If the future value of an ordinary, 11 year annuity is $5,575 and interest rates are 5.5%, what is the future value of the same annuity due?

• A) $5,619.52
• B) $5,769.06
• C) $5,881.63
• D) $5,947.88

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Definitions:

Stockholders' Equity

The ownership claim on a corporation's assets that remains after all liabilities are accounted for, denoting shareholder interest.

Current Assets

Short-term assets that are expected to be converted into cash within one year or within the operating cycle of a business.

Interest Expense

The cost incurred by an entity for borrowed funds, which is charged as an expense on the income statement.

Interest-Bearing Note

A debt security that pays interest to the holder at a fixed or variable rate until the maturity date of the note.