Decide Whether the Problem Relates to an Ordinary Annuity or an Annuity

question 121

Multiple Choice

Decide whether the problem relates to an ordinary annuity or an annuity due. A retiree inherits $100,000 and invests it at an annual rate of 7.7%, compounded monthly, in an annuity that provides an amount at the end of each month for the next 11 years. Find the monthly amount. ​

• A)Ordinary annuity
• B)Annuity due

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