The first payment of a perpetuity- immediate is 62. Subsequent payments decrease by 1 per year until they reach a level of k. Payments remain constant at k thereafter. The present value of the perpetuity is equal to the present value of a perpetuity-immediate paying 52.69 each year. The annual effective interest rate is 10%. Calculate k. [4.h-i #21] O 31 34
The first payment of a perpetuity- immediate is 62. Subsequent payments decrease by 1 per year until they reach a level of k. Payments remain constant at k thereafter. The present value of the perpetuity is equal to the present value of a perpetuity-immediate paying 52.69 each year. The annual effective interest rate is 10%. Calculate k. [4.h-i #21] O 31 34
College Algebra
7th Edition
ISBN:9781305115545
Author:James Stewart, Lothar Redlin, Saleem Watson
Publisher:James Stewart, Lothar Redlin, Saleem Watson
Chapter8: Sequences And Series
Section8.4: Mathematics Of Finance
Problem 2E
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