Thread: Annuity

Which annuity has the greater amount at the end of 5 years?Why does this happen?

Annuity A:$100 at the end of each month for 5 years at 6%a compounded monthly.

Annuity B:$1200 at the end of each year for 5 years at 6%a compounded annually.



2.When you double the time of an annuity,do you double the amount at maturity?

Annuity A vs Annuity B

$100 of A has been collecting interest for 11 months before that $1200 of B even shows up.

2. I sincerely hope not, unless it's linear. If there is ANY compounding going on, then life is better.