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Future Value of Annuity versus Annuity Due

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Future value: annuity versus annuity due

What's the future value of a 7 percent, 5-year ordinary annuity that pays $300 each year? If this were an annuity due, what would its future value be?

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Solution Summary

The solution explains how to calculate the future value of an annuity

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Future value of an annuity can be calculated using the FV of annuity formula. It is given as

FV = ...

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