I want to know whether immediate annuity is the annuity paid in arrear or not. In the CT1 notes provided by ActEd, they use these 2 terms interchangeably. However, as definition, the immediate annuity is the annuity that the first payment is made during the first time period. Here I attached an image from Acted CT1 notes for further information. Thanks very much for any help. [Image]
I don't think we use those terms interchangeably. As quoted above, an immediate annuity is any annuity where there is a payment made during the first time period. This payment could be at the start of the first time period (giving an annuity-due), at the end of the time period (giving an annuity in arrears) or continuously over the time period (giving a continuously-payable annuity). So an annuity-due, an annuity in arrears and a continuously-payable annuity are all examples of an immediate annuity.
Here is a screenshot of the CT1 notes. I think that instead of saying "immediate annuity" as shown in the screenshot, we should say "annuity paid in arrear".
Generic types of payments. 1) Immediate 2) deferred Sub types in above Due(in advance) or arrears So immediate can be in advance or in arrears and same for deferred
