If your investment pays the same amount at the end of each year for a period of six years, the cash flow stream is called _____. (CSLO 3)

A.

a perpetuity.

B.

an ordinary annuity.

C.

an annuity due.

D.

a growing perpetuity.

You have received news about an inheritance that will pay you $5,000 next year. Beginning the following year, your inheritance will increase by 5 percent every year forever. This is a growing perpetuity. (CSLO 3)

A.

True

B.

False