What are the different kinds of multiple cash flows we can have? What are the differences...
What are the different kinds of multiple cash flows we can have? What are the differences characteristics of Annuity and Annuity Due? How do you apply annuity in mortgage problem? Loan amortization problem?
Homework Answers
Different types of cash flow
Standard Cash flow : This are single payment cash flow i.e occurs one time only
Uniform series cash flow : These are cash flow that occur at regular interval and are uniform Eg Annuity
Uneven cash flow : Cash flow that are not uniform and occurs at irregular period
Difference between Annuity and annuity Due
Annuity : A series of uniform cash flow that occurs at END of period
Annuity Due : A series of uniform Cash flow that occurs at BEGINNING of the period
Use of Annuity in mortgage problem and loam amortization problem
Given the rate of interest , period of loan and loan amount one can find EMI using Present value of annuity factor
EMI is nothing but annuity.
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What are the different kinds of multiple cash flows we can have?
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