An annuity is defined as
A) Equal cash flows at equal intervals of time for a specified period of time
B) Equal cash flows at equal intervals of time forever
C) Unequal cash flows at equal intervals of time forever
D) None of the above

Question

Quizplus · Accepted Answer

An annuity is a series of equal cash flows at equal intervals of time for a specified period of time. Therefore, option A is the correct definition of an annuity. Option B describes a perpetuity, while option C describes an increasing or decreasing annuity. Option D is not a valid choice as one of the options is correct.

An Annuity Is Defined as