Question

which of the following is not a term for the period of time during which the annuitant or the beneficiary receives income?A. Pay-out periodB. Liquidation periodC. Depreciation periodD. Annuitization period

Answer 1

Answer:

C. Depreciation period

Explanation:

For A,

A payout period is when the investors actually start getting paid hence making this a wrong choice.

For B,

Liquidation is when a firm runs into problems and prepares to shut down by liquidating assets, the proceeds from this liquidation are then paid out to investors. This also is a wrong choice.

For C,

Depreciation period is the time period for which the depreciation is charged on a fixed operating asset. This is recorded as an expense and nothing is paid out to any investor. This is the correct choice.

For D,

Annuitization period is when any annuity or investment starts paying back its investors. This is an income stream and thus this is also a wrong choice.

Hope that helps.