An annuity consists of ten payments, each equal to $1000. Each payment is made on 30 June each year from 2021 through to 2030 inclusive.
The rate of compound interest is 5% per annum.
The present value of the annuity is calculated at 30 June 2020.
The future value of the annuity is calculated at 30 June 2030.
Without performing any calculations, which of the following statements is true?
- Present value of the annuity < $10 000 < future value of the annuity
- $10 000 < present value of the annuity < future value of the annuity
- Future value of the annuity < $10 000 < present value of the annuity
- $10 000 < future value of the annuity < present value of the annuity