5.6 Highlights
- Annuity is a sequence of equal payments made at equal periods of time.
- When the payments are made at the end of the time period, the annuity is called an ordinary annuity.
- When the payments are paid at the beginning of each payment period, the annuity is called an annuity due.
- There is a significant difference between the present and future value for an ordinary annuity and an annuity due.
