A perpetuity of $5,000 per year beginning today is said to offer a 15% interest rate. What is its present value?
A) $33,333.33
B) $37,681.16
C) $38,333.33
D)$65,217.39

Name: A perpetuity of $5,000 per year beginning today is said to offer a 15% interest rate. What is its present value? A) $33,333.33 B) $37,681.16 C) $38,333.33 D)$65,217.39
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Question

Quizplus · Accepted Answer

PV = $5,000 + FV/rPV = $5,000 + $5,000/.15PV = $5,000 + $5,000/.15PV = $38,333.33

A Perpetuity of $5,000 Per Year Beginning Today Is Said