Each payment of an annuity due is compounded for one additional period, so the future value of an annuity due is equal to the future value of an ordinary annuity compounded for one additional period.
Annuity Due: An annuity that has a payment that is due right away at the start of each term is known as an annuity due. An ordinary annuity, in which payments are made at the end of each quarter, might be compared to an annuity due. Rent, which is paid at the start of each month, is a typical illustration of an annuity due payment.
Each payment of an annuity due is compounded for one additional period, so the future value of an annuity due is equal to the future value of an ordinary annuity compounded for one additional period.
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