Which of the following formulas is INCORRECT?
A) PV of a growing annuity = C ×
B) PV of an annuity = C ×
C) PV of a growing perpetuity =
D) PV of a perpetuity =

Question

Which of the following formulas is INCORRECT?
A) PV of a growing annuity = C × 
B) PV of an annuity = C × 
C) PV of a growing perpetuity = 
D) PV of a perpetuity =

Quizplus · Accepted Answer

The correct formula for the PV of a growing annuity is C × ((1 + g)/(r-g)) × (1 - (1 + g)^-n), where C is the constant periodic cash flow, g is the growth rate, r is the discount rate, and n is the number of periods. The formula provided in option A is incorrect as it has some random strings added to it. Options B, C, and D have the correct formulas for the PV of an annuity, the PV of a growing perpetuity, and the PV of a perpetuity, respectively.

Which of the Following Formulas Is INCORRECT