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CIMAPRA17-BA2-1 Exam - Topic 1 Question 112 Discussion

Which of the following is the correct definition is an annuity:
A) A chain of regular cash flows up to a certain period of time.
B) A series of cash outflows which goes on forever.
C) A set of regular payments of increasing value.

CIMAPRA17-BA2-1 Exam - Topic 1 Question 112 Discussion

Actual exam question for CIMA's CIMAPRA17-BA2-1 exam
Question #: 112
Topic #: 1
[All CIMAPRA17-BA2-1 Questions]

Which of the following is the correct definition is an annuity:

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Suggested Answer: A

by Nan at Jun 26, 2026, 04:21 AM

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Lonny
9 hours ago
Exactly! A is straightforward. Regular payments over time.
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Cathern
6 days ago
A is clear and precise. It captures the essence of an annuity.
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Niesha
11 days ago
C is misleading. Annuities don’t necessarily increase in value.
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Dalene
16 days ago
B sounds tempting, but it’s not accurate for annuities.
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Samira
21 days ago
I agree, A fits the definition best. Time-bound cash flows are key.
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Venita
26 days ago
I think A is the right choice. Regular cash flows make sense.
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Cheryl
1 month ago
Totally agree with A), it’s straightforward!
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Leatha
1 month ago
Wait, are we sure A) is the only definition?
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Darci
1 month ago
C) sounds interesting, but it’s not an annuity.
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Patria
2 months ago
I thought B) was correct at first, but it’s not.
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Royce
2 months ago
A) is the right answer!
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Lynna
2 months ago
I thought an annuity was about fixed payments, but now I'm second-guessing if increasing payments could also fit the definition.
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Evangelina
2 months ago
I feel like option A sounds right because it mentions regular cash flows, which is what we studied.
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Jolene
2 months ago
I remember practicing a question that mentioned cash flows going on forever, but I can't recall if that was the definition of an annuity or something else.
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Kattie
2 months ago
I think an annuity is related to regular cash flows, but I'm not sure if it's just for a certain period or not.
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