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ABy Admin
Nov 22'23

Exercise

Which of these are true about annuities?

  • An annuity due is one that requires payments at the end of every month.
  • A geometric perpetuity present value can be represented by K/(i-r).
  • Because an increasing annuity immediate has an annuity due equation in its equation, it becomes an annuity due.
  • I only
  • II only
  • III only
  • II and III
  • I, II, and III are all false

Hardiek, Aaron (June 2010). "Study Questions for Actuarial Exam 2/FM". digitalcommons.calpoly.edu. Retrieved November 20, 2023.

ABy Admin
Nov 22'23

Solution: B

I- False: Annuity Due requires payments at the beginning of every month

II- True

III- False: It is still an annuity immediate

Hardiek, Aaron (June 2010). "Study Questions for Actuarial Exam 2/FM". digitalcommons.calpoly.edu. Retrieved November 20, 2023.

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