# How can you convert the present value of an ordinary annuity into the present value of annuity due?

Annuities are simply a series of payments or cash flow that occur periodically. Examples include lease and payment of rent. Annuities may be of two main types, ordinary annuity and annuity due. In an ordinary annuity cash flow (periodic payment) occurs at the end of every period, lets say month. Whereas, incase of annuity due, the payment for that particular month would be made at the starting of the period rather than the end. We can convert ordinary annuity into annuity due by multiplying the value of ordinary annuity by interest factor with power one, i. e. (1+i). Mathematically, PVad = PVoa(1+i) Assignment 5.
2 How can you convert the future value of an ordinary annuity into the future value of an annuity due. For more information about future value of an annuity go to URL: http://www. getobjects. com/Components/Finance/TVM/fva. html The same rule/formula would apply to the future value of annuity as well. It may be converted from ordinary to due by using the following formula: FVad = FVoa(1+i) Assignment 5. 3 What is an amortization schedule? What are the items that are shown in each row? For more information about amortization go to URL: http://www. getobjects. com/Components/Finance/TVM/amortization. html
An amortization schedule is a table that is used for calculating payments that are to be made in the form of installments. It indicates how much of the payment made contributed to principal, and interest. The items shown in the schedule includes Time of the payments, which may be years or months, depending on when the installments are made. The total payment made and its breakup into interest and principal. And last but not the least, the amount of balance that still remains after the payment is made. Internet Assignment 8. 2 Open URL http://mindyourdecisions. com/blog/2007/08/22/the-idea-of-sunk-costs/

and read the article The Idea of Sunk Cost. The author gives three examples of sunk cost. Think of an example of sunk cost from your experience and describe it in a paragraph. I went to a picnic a couple of years back. We were supposed to go to a seaside. So we made all the necessary arrangements and left early morning. But upon reaching the shores, we realized that the tides were very high, and the sea was very rough, and so coast guards had temporarily closed the beach. The time and cost incurred during that trip was my sunk cost. Opportunity cost: This is the cost of the foregone alternative.
Such costs are included as incremental cash flows although no actual cash flow takes place. The reason is that there is a potential cash flow that could have taken place were it not for the decision to proceed with the project. Let us consider an example. I am a sports fan and I love watching football. But on the other hand, I also enjoy movies, and Tom Hanks is my favorite actor. Now at the same time, a particular football game is being televised live on a certain channel, and some other channel is playing one of my favorite Tom Hanks movies. Incase I watch one program, I would have to bear losing the other one. This is my opportunity cost.

Don't use plagiarized sources. Get Your Custom Essay on
How can you convert the present value of an ordinary annuity into the present value of annuity due?
Just from \$13/Page
Pages (550 words)
Approximate price: -

Why Work with Us

Top Quality and Well-Researched Papers

We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.

We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.

Free Unlimited Revisions

If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.

Prompt Delivery and 100% Money-Back-Guarantee

All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.

Original & Confidential

We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.

Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.

Try it now!

## Calculate the price of your order

Total price:
\$0.00

How it works?

Fill in the order form and provide all details of your assignment.

Proceed with the payment

Choose the payment system that suits you most.

Our Services

No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.

## Essay Writing Service

No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.

An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.

Editing Support

Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.

Revision Support

If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.

error: Content is protected !!

Order your essay today and save 20% with the discount code RESEARCH