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    Lesson 11 - Simple Annuity PDF

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    Peter Eclevia
    1. The document discusses the concept of simple annuity, which refers to a sequence of equal payments made at regular intervals. 2. There are different types of annuities such as ordinary annuity, annuity due, and deferred annuity, which are classified based on when payments begin and end. 3. Formulas are provided for calculating the accumulated amount of ordinary annuities and annuities due using variables like the periodic payment amount, interest rate, and number of periods.

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    Lesson 11 - Simple Annuity PDF

    Uploaded by

    Peter Eclevia
    519 views2 pages
    1. The document discusses the concept of simple annuity, which refers to a sequence of equal payments made at regular intervals. 2. There are different types of annuities such as ordinary annuity, annuity due, and deferred annuity, which are classified based on when payments begin and end. 3. Formulas are provided for calculating the accumulated amount of ordinary annuities and annuities due using variables like the periodic payment amount, interest rate, and number of periods.

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    1. The document discusses the concept of simple annuity, which refers to a sequence of equal payments made at regular intervals. 2. There are different types of annuities such as ordinary annuity, annuity due, and deferred annuity, which are classified based on when payments begin and end. 3. Formulas are provided for calculating the accumulated amount of ordinary annuities and annuities due using variables like the periodic payment amount, interest rate, and number of periods.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    519 views2 pages

    Lesson 11 - Simple Annuity PDF

    Uploaded by

    Peter Eclevia
    1. The document discusses the concept of simple annuity, which refers to a sequence of equal payments made at regular intervals. 2. There are different types of annuities such as ordinary annuity, annuity due, and deferred annuity, which are classified based on when payments begin and end. 3. Formulas are provided for calculating the accumulated amount of ordinary annuities and annuities due using variables like the periodic payment amount, interest rate, and number of periods.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 2

    Mathematics in the Modern World

    1
    Mathematics of Finance

    Module 11 Simple Annuity

    At the end of this module, you are expected t0:

    1 Understand the concept of simple annuity.


    2. Identify different kinds of annuities
    3. Solve problems involving annuities.

    Annuity
    It is a sequence of equal payments made at equal periods. Payments may be done
    annually, semi-annually, etc. Some good examples are monthly payments of rent, weekly wages and
    annual premiums on life insurance policy.

    Annuities are classified according to:


    1. Annuity certain- it is one which payment begin and end at fixed times.
    2. Contigent annuity-it is one whose payment depend on an event that cannot be foretold
    accurately.
    Kinds of annuity certain:
    1. Ordinary annuity-payment is done at the end of the term
    2. Annuity due-payment is done at the beginning of the term
    3. Deferred annuity-payment is not given in the beginning or end of a period but in some later
    period.
    Formulas for accumulated amount(F) of Annuities
    𝑹[(𝟏+𝒊)𝒏 −𝟏]
    F= (Ordinary)
    𝒊

    𝑹[(𝟏+𝒊)𝒏 −𝟏]
    F= (1+i) (Annuity Due)
    𝒊

    R-periodic payment

    Course Module
    References and Supplementary Materials
    Books and Journals
    1. Richard Aufmann ,Joanne Lockwood ,Richard Nation ,Daniel Clegg ,Susanna S.
    Epp;2018;Mathematics in the Modern World;Manila ,Philippines;Rex Bookstore,Inc
    2. Susana S. Epp;2011;Discrete Mathematics:An Introduction to Mathematical Reasoning
    ;Brooks/Cole ;Cengage Learning
    3. Darwin P. Paguio, et al;2013;Mathematics of Investment; Tinajeros,Malabon;
    Jimczyville Publications

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