The constant periodic cash flows, over a specified period, is known as Annuity. The cash flows can be receipts or disbursements of equal amounts made at a set time interval, i.e. weekly, monthly, quarterly, semiannually, or annually. The following are the types of annuity:
Ordinary Annuity: The payment or deposit of cash occurs at the year.
Annuity Due: The inflow or outflow of cash occurs at the beginning.
Perpetuity: The annuity which is everlasting.
Others: Some other annuity types are fixed annuity and variable annuity.
