What is the primary difference between an ordinary annuity and an annuity due?
A) The timing of the periodic payment.
B) The interest rate.
C) Annuity due only relates to present values.
D) Ordinary annuity only relates to present values.

Question

Quizplus · Accepted Answer

The primary difference between an ordinary annuity and an annuity due is the timing of the periodic payment. In an ordinary annuity, payments are made at the end of each period, while in an annuity due, payments are made at the beginning of each period. This difference can impact the present and future value calculations of the annuity.

What Is the Primary Difference Between an Ordinary Annuity and an Annuity