All of these scenarios are examples of annuities EXCEPT
A) Chris only has to pay credit card bills when he buys items with his card.
B) Mallory pays $500 in rent every month.
C) Steve pays monthly installments of $50 per month for the holiday presents he bought on layaway.
D) Crystal pays a heating and air conditioning specialist $150 twice per year to prepare her temperature control system prior to Summer and Winter.
E) Kate pays $1,500 per month for her mortgage.

Question

Quizplus · Accepted Answer

Mallory, Steve, Crystal, and Kate are all paying annuities, or guaranteed equal payments for a given number of periods. Monthly, quarterly, and annual payments all qualify as annuities. For example, a monthly car payment, a monthly mortgage payment, and a semi-annual bond interest payment would be annuities.

All of These Scenarios Are Examples of Annuities EXCEPT