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  • 14-07-2020
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A perpetuity of $6,000 per year beginning one year from today is said to offer a 15% interest rate. What is its present value? g

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facundobuzzetti
facundobuzzetti facundobuzzetti
  • 17-07-2020

Answer:

PV= $40,000

Explanation:

Giving the following information:

Perpetuity of $6,000 per year beginning one year from today is said to offer a 15% interest rate.

To calculate the present value, we need to use the following formula:

PV= Cf/i

Cf= cash flow

i= interest rate

PV= 6,000/0.15

PV= $40,000

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