Question

an investment pays $20 at the beginning of each month. What kind of cash flow stream...

an investment pays $20 at the beginning of each month. What kind of cash flow stream can this be?

options:
- ordinary annuity
- annuity
- perpetuity
- present value
- annuity due or perpetuity

sorry, this is just a theory question... thank you

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Answer #1
An annuity is a cash flow either income or outgoings, involving
the same sum in each period.
That means an annuity is the receipt or payment of equal
cashflows per period.
Perpetuity is a stream of payments or type of annuity that begin
on a fixed date and continue indefinitely.
So, an investment pays $20 at the beginning of each month
would be Annuity Due or Perpetuity.
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