The management of my apartment offers 1 month discount for anyone paying maintenance bill for 1 year up front instead of monthly. What is the interest I gain, if I pay my maintenance bill, say $100 per month for the whole year (12 months) or only for 11 month in a year ($1100 per year)? A quick guess would be 1/12 = 8.3%. But the future value of annuity with $100 monthly payment suggests a different rate, if I'm not mistaken 19.5%. Which rate should I use? Suppose I could find an investment that returns 12% per annum, should I pay my maintenance bill monthly or yearly?