There are three categories of cash flows: single cash flows, also referred to as "lump sums," a stream of unequal cash flows, and annuities. Based on your understanding of annuities, answer the following questions. Which of the following statements about annuities are true? Check all that apply. Ordinary annuities make fixed payments at the end of each period for a certain time period. An annuity due is an annuity that makes a payment at the end of each period for a certain time period. An annuity due earns more interest than an ordinary annuity of equal time. A perpetuity is a constant, infinite stream of equal cash flows that can be thought of as an infinite annuity.

Answers

Answer 1

Answer:

Answer:

All statement are correct except the the second one.

Explanation:

Ordinary annuities make fixed payments at the end of each period for a certain time period.

True. the differentiating feature between ordinary annuities and annuity dues is the timing of the cash-flows- If payments are made at the end of each period, the payment stream is an ordinary annuity but if payments are made at the beginning of each period, then the stream is an annuity due.

An annuity due is an annuity that makes a payment at the end of each period for a certain time period.

False. with an annuity due, payments are made at the beginning of each period.

An annuity due earns more interest than an ordinary annuity of equal time.

True. Payments are made sooner in an annuity due, with the 1st payment made at the beginning of the first period and the last payment being made at the beginning of the last period. Thus each payment earns interest and as a result, both the present value and the future value are higher than that of an ordinary annuity.

A perpetuity is a constant, infinite stream of equal cash flows that can be thought of as an infinite annuity.

True. A perpetuity is a stream of cash-flows starting at a certain date with equal payments at equal intervals but with no terminal date. Therefore the stream of cash-flows is expected to continue forever- which makes it an infinite annuity.

Related Questions

Which one of the following statements is correct? a. Book values should always be given precedence over market values.b. Financial statements are frequently the basis used for performance evaluations.c. Historical information has no value when predicting the future.d. Potential lenders place little value on financial statement information.e. Reviewing financial information over time has very limited value.
As the result of an increase in capital the demand for labor would_______, the supply of labor would ________, and the quantity of laborhired would __________.a. increase, increase, increaseb. increase, remain the same, increasec. increase, remain the same, decreased. increase, decrease, remain the samee. decrease, decrease, decrease
Geographically dispersed work groups no longer pose additional communication challenges given todays technology.a) trueb) false
Comparative financial statements for Weller Corporation, a merchandising company, for the year ending December 31 appear below. The company did not issue any new common stock during the year. A total of 860,000 shares of common stock were outstanding. The interest rate on the bonds, which were sold at their face value, was 12%. The income tax rate was 40% and the dividend per share of common stock was $0.40 this year. The market value of the company’s common stock at the end of the year was $21. All of the company’s sales are on account.Weller CorporationComparative Balance Sheet(dollars in thousands)This Year Last YearAssets Current assets: Cash $ 976 $ 1,920 Accounts receivable, net 15,000 10,050 Inventory 10,000 8,440 Prepaid expenses 1,860 2,220 Total current assets 27,836 22,630 Property and equipment: Land 6,600 6,600 Buildings and equipment, net 19,800 19,600 Total property and equipment 26,400 26,200 Total assets $ 54,236 $ 48,830 Liabilities and Stockholders' Equity Current liabilities: Accounts payable $ 10,100 $ 8,600 Accrued liabilities 720 1,000 Notes payable, short term 360 360 Total current liabilities 11,180 9,960 Long-term liabilities: Bonds payable 6,250 6,250 Total liabilities 17,430 16,210 Stockholders' equity: Common stock 860 860 Additional paid-in capital 4,500 4,500 Total paid-in capital 5,360 5,360 Retained earnings 31,446 27,260 Total stockholders' equity 36,806 32,620 Total liabilities and stockholders' equity $ 54,236 $ 48,830 Weller CorporationComparative Income Statement and Reconciliation(dollars in thousands)This Year Last YearSales $ 85,000 $ 80,000 Cost of goods sold 55,000 51,000 Gross margin 30,000 29,000 Selling and administrative expenses: Selling expenses 9,100 8,600 Administrative expenses 12,600 11,600 Total selling and administrative expenses 21,700 20,200 Net operating income 8,300 8,800 Interest expense 750 750 Net income before taxes 7,550 8,050 Income taxes 3,020 3,220 Net income 4,530 4,830 Dividends to common stockholders 344 645 Net income added to retained earnings 4,186 4,185 Beginning retained earnings 27,260 23,075 Ending retained earnings $ 31,446 $ 27,260 Required: Compute the following financial data for this year:1. Gross margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)2. Net profit margin percentage. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)3. Return on total assets. (Round your percentage answer to 1 decimal place (i.e., 0.1234 should be entered as 12.3).)4. Return on equity. (Round your percentage answer to 2 decimal places (i.e., 0.1234 should be entered as 12.34).)
Dextra Computing sells merchandise for $6,000 cash on September 30 (cost of merchandise is $3,900). Dextra collects 5% sales tax. 1. Record the entry for the $6,000 sale and its sales tax. 2. Record the entry that shows Dextra sending the sales tax on this sale to the government on October 15.3. Record the cost of Sept. 30th sales.4. Record the entry that shows the remittance of the 5% tax on this sale to the state government on October 15.5. Record the cash sales and 3% sales tax.

According to the media report how have the commited collusion

Answers

Answer:

You must post the whole paragraph?????

A government decision to privatize a sector of the economy formerly operated by the government is an example of _____ policy.

Answers

Answer:

Structural policy

Explanation:

This is an example of what is known as structural policy.

There are times where the problem of an economy get to be more and also last longer than inadequate demand. This problem can be caused by government policies or sometimes private practices that cause an impediment on the efficient production of goods and Also services. In other to fix a problem such as this, changes have to be made to the economy. Such changes is what is regarded as structural policy.

Carlos, the HR Director of a large paper manufacturing company, is studying the company's turnover costs. He has accounted for most of the easily calculable costs, but he is concerned about the hidden costs of turnover. Given this information, which of the following is most likely a cause of concern for Carlos?a. Missed project deadlines
b. Employee referral fees
c. Preemployment medical expenses
d. Accrued vacation expenditures

Answers

Answer:

Missed project deadlines

Explanation:

From the question, we are informed about Carlos, who is the HR Director of a large paper manufacturing company, is studying the company's turnover costs. He has accounted for most of the easily calculable costs, but he is concerned about the hidden costs of turnover. Given this information, the most likely a cause of concern for Carlos is Missed project deadlines.

Project deadlines can be regarded as

final time point which is needed for a given project to be done as well as the submission of handing over. It is been

characterized as desired time-frame set for a project as well as links initial time expectations for the project to be

produced in a timely manner.

An agent informs owners in an area that a decline in property values over the past five years is due to an influx of minority families. He suggests that the trend will continue, and advises them to sell before it is too late. This agent is probably guilty of

Answers

Answer:

This agent is probably guilty of

Blockbusting

Explanation:

Blockbusting is an illegal act. It is a manipulative method used by real estate agents to get homeowners to sell or rent their property at a cheaper rate by lying to them that the socioeconomic demography of the neighborhood is changing, so they have to sell before it is too late. This can be seen in how the agent informs the owners that their property experienced a decline in the past 5 years because of the minorities who moved in. The Fair Housing Act of 1968 makes blockbusting illegal.

Last year, you earned a nominal rate of return of 6.92 percent on your bond investments. During that time, the inflation rate was 2.74 percent. How much did your purchasing power increase (real rate)

Answers

Answer:

Real rate of return= 0.0418 = 4.18%

Explanation:

Giving the following information:

Nominal rate of return= 6.92%

Inflation rate= 2.74%

The inflation rate decreases the purchasing power of nominal money.

To calculate the real rate of return, we need to use the following formula:

Real rate of return= nominal rare of return - inflation rate

Real rate of return= 0.0692 - 0.0274

Real rate of return= 0.0418 = 4.18%

Joe verbally contracts with Delia to sell his farm to Delia. They do not sign a contract, but Delia takes possession, makes a down payment, and starts making monthly payments. This is evidenced by the down payment check, several monthly checks, and emails. Joe decides after several months to sell his farm to Eli. They sign a contract. If Delia objects to the second sale: __________a. Della will lose because he did not sign a contract.
b. Delia will lose because the second contract win writing.
c. Delta will win because he partially performed and he can demonstrate the agreement by writings.
d. Delia will becuse he's not merchant

Answers

Answer:

a. Della will lose because he did not sign a contract.

Explanation:

The UCC are a set of guidelines that is used for trade transactions to resolve disputes and ensure equity between the buyer and seller.

There are various criteria used to qualify a valid transaction. One of them is that for a non movable asset, it's sale must be under a written contract.

A verbal contract will not suffice and is not binding.

In this scenario where Joe verbally contracts with Delia to sell his farm to Delia, they did not sign a contract and makes a down payment. But Joe decides after several months to sell his farm to Eli.

Since there is no written contract if Delia objects to the second sale she will lose

Other Questions

You are considering acquiring a common stock that you would like to hold for one year. You expect to receive both $2.50 in dividends and $28 from the sale of the stock at the end of the year. The maximum price you would pay for the stock today is ________ if you wanted to earn a 15% return. Group of answer choices $24.11 $27.50 $23.91 $26.52 None of the options are correct.

true false greater than 11 percent a bond with an $100 annual interest payment with five years to maturity would sell for a premium if interest rates were below 9 percent

Manufacturers Southern leased high-tech electronic equipment from Edison Leasing on January 1, 2021. Edison purchased the equipment from International Machines at a cost of $168,120. (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) Related Information: Lease term 2 years (8 quarterly periods) Quarterly rental payments $22,500 at the beginning of each period Economic life of asset 2 years Fair value of asset $168, 120 Implicit interest rate (Also lessee's incremental borrowing rate) 88 Required: Prepare a lease amortization schedule and appropriate entries for Manufacturers Southern from the beginning of the lease through January 1, 2022. Amortization of the right-of-use asset is recorded at the end of each fiscal year (December 31) on a straight-line basis.

Assume a Cobb-Douglas production function of the form: q equals 10 Upper L Superscript 0.97 Baseline Upper K Superscript 0.18. What type of returns to scaleLOADING... does this production function exhibit? In this instance, returns to scale equal nothing. (Enter a numeric response using a real number rounded to two decimal places.) This production function exhibits A. decreasing returns to scale. B. constant returns to scale. C. initially increasing but then constant returns to scale. D. initially constant but then increasing returns to scale. E. increasing returns to scale.