BUSINESS ADMINISTRATION
FINANCIAL MANAGEMENT
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Serial Cash flow
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Regular Cash flow
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Annuity Cash flow
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None of the Above
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Detailed explanation-1: -An annuity is a series of equal cash flows, or payments, made at regular intervals (e.g., monthly or annually). The payments must be equal, and the interval between payments must be regular.
Detailed explanation-2: -An annuity is a constant cash flow that occurs at regular intervals for a fixed period of time. An annuity can occur at the end of each period or at the beginning of each period.
Detailed explanation-3: -If the periodic payments are made at the end of each period, the annuity is called an immediate annuity or ordinary annuity.
Detailed explanation-4: -An ordinary annuity is an annuity in which cash flows occur at the beginning of each period.
Detailed explanation-5: -An ordinary annuity is when a payment is made at the end of a period. An annuity due is when a payment is due at the beginning of a period. While the difference may seem meager, it can make a significant impact on your overall savings or debt payments.