Different Types of TVOM

Growing Annuity

A growing annuity is the same as annuity in that payments for both end at a certain period. However, payments of growing annuity increase at a constant rate while payments of annuity are fixed.

Growing annuity is also similar to growing perpetuity; payments of both increase at a constant rate. Unlike growing perpetuity, payments of growing annuity end at some point.

Timeline with r equals 10%, -100 at 1,-105 at 2, -110.25 at 3, an arrow pointing to infinity, g equals 5% and P V G A equals question mark.