Question

select the best definition of an ordinary annuity.

an annuity that makes payments forever

an annuity whose payments are made at the end of the period

an annuity whose payments can be made at any point during the period

an annuity whose payments are made at the beginning of the period

Explanation:

To determine the best definition of an ordinary annuity, we analyze each option:

• "An annuity that makes payments forever" describes a perpetuity, not an ordinary annuity.
• "An annuity whose payments are made at the end of the period" matches the definition of an ordinary annuity.
• "An annuity whose payments can be made at any point during the period" is not a standard definition of an ordinary annuity.
• "An annuity whose payments are made at the beginning of the period" describes an annuity due, not an ordinary annuity.

Answer:

B. An annuity whose payments are made at the end of the period