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Business, 22.02.2021 19:00 daniel9299

You are comparing two investments, both of which provide annuity payments in exchange for a lump sum investment today. Each annuity has the same monthly payment for the same number of years. You require the same rate of return for each of these investments. Annuity A pays at the beginning of each month and annuity B pays at the end of each month. Given this information, which one of the following statements is correct? A. Both annuities have the same equal future value.
B. Annuity B is worth more today because of the timing of its cash flows.
C. Annuity A is worth more today because you will receive one more payment whereas Annuity B receives one less payment.
D. Annuity A has a higher present value and a lower future value than annuity B.
E. Annuity A has a higher future value than annuity B.

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