State whether the problem relates to an ordinary annuity or an annuity due. Mr. Gordon plans to invest $500 at the end of each month in an account that pays an annual rate of 9%, compounded monthly. After how many months will the account be worth $60,000?
A)ordinary annuity
B)annuity due

Question

State whether the problem relates to an ordinary annuity or an annuity due. Mr. Gordon plans to invest $500 at the end of each month in an account that pays an annual rate of 9%, compounded monthly. After how many months will the account be worth $60,000? ​
A)ordinary annuity
B)annuity due

Quizplus · Accepted Answer

Since Mr. Gordon plans to invest $500 at the end of each month, this is an ordinary annuity. An annuity due would refer to payments made at the beginning of each period.

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