What Is an Annuity

question 10

Multiple Choice

What is an annuity?

• A)A fixed sum to be paid at regular intervals to an insurance policyholder for either a certain or indefinite period
• B)The cash reserve that increases each year an insurance policy remains in force as a minimum savings feature
• C)An annual sum that the insured pays to an insurance company as consideration for the insurance contract
• D)An alternative that a party to an insurance contract agrees to follow to discharge the agreement

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Definitions:

Queue Discipline

Describes the rule or set of rules used to prioritize and manage elements in a queue, determining the order in which they are serviced.

M/M/1

A model in queueing theory representing a system with a single server where arrivals and service times are Poisson distributed.

M/D/1

A notation in queueing theory representing a system with a single server, where arrivals are Markovian (M), service times are deterministic (D), and there is one server or channel (1).

Arrival Rate Distribution

Statistical representation describing the frequency and pattern of arrivals at a service system over a specific period.