An annuity is defined as a series of payments of a fixed amount for a

QUESTION

An annuity is defined as a series of payments of a fixed amount for a specific number of periods. Thus, $100 a year for 10 yrs is an annuity, but $100 in year 1, $200 in year 2, and $400 in years 3 thru 10 does not constiture an annuity. However the entire series does contain an annuity. Is this sta
If taking the strict definition of an annuity then yes this is true (the one with unequal cash flows). The series does contain an annuity i.e. the $400 from

r 3 to 10 is an annuity, while the cash flows for year 1 and 2 are simply present valued and not an annuity

ANSWER:

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