An annuity in which the periodic payment begin on a fixed date and continue forever is called
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → Perpetuity
(A) Sinking Fund
This is used to accumulate a future amount, not a never-ending annuity.
False
(B) Perpetuity
This is an annuity that continues forever.
True
(C) Coupon payment
This refers to periodic interest on bonds, not an annuity continuing forever.
False
(D) Bond
This is a financial instrument, not the name of such an annuity.
False
The correct answer is (B) Perpetuity.