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Questions and Answers
What type of annuity has payment intervals that are not the same as the interest compounding period?
What type of annuity has payment intervals that are not the same as the interest compounding period?
In which type of annuity are the payments made at the end of each payment interval?
In which type of annuity are the payments made at the end of each payment interval?
What is the term used for an annuity in which the payments extend over an indefinite (or indeterminate) length of time?
What is the term used for an annuity in which the payments extend over an indefinite (or indeterminate) length of time?
What is the term used for the time between the first payment interval and the last payment interval of an annuity?
What is the term used for the time between the first payment interval and the last payment interval of an annuity?
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What is the term used for each payment made in an annuity?
What is the term used for each payment made in an annuity?
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In which type of annuity do payments begin and end at specific dates?
In which type of annuity do payments begin and end at specific dates?
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What is the term used for an annuity where the payment intervals are the same as the interest period?
What is the term used for an annuity where the payment intervals are the same as the interest period?
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What is the term used for a sequence of equal payments made at a regular interval of time?
What is the term used for a sequence of equal payments made at a regular interval of time?
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Study Notes
Annuity Types
- An annuity with payment intervals that are not the same as the interest compounding period is called an uneven annuity.
Payment Timing
- In an ordinary annuity, payments are made at the end of each payment interval.
Annuity Duration
- An annuity with payments that extend over an indefinite or indeterminate length of time is called a perpetuity.
Annuity Period
- The term used to describe the time between the first payment interval and the last payment interval of an annuity is the annuity period.
Payment Terminology
- Each payment made in an annuity is called an installment.
Fixed-Term Annuity
- An annuity with payments that begin and end at specific dates is called a fixed-term annuity.
Synchronized Annuity
- An annuity where the payment intervals are the same as the interest period is called a synchronized annuity.
General Annuity Definition
- A sequence of equal payments made at a regular interval of time is defined as an annuity.
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Description
Learn about the different types of annuities, including simple annuity and general annuity, based on the payment interval and interest compounding period. Understand the distinctions between these two categories of annuities.
