For the following questions, assume an end-of-year cash flow of $250 and a 10% discount rate. a.

Question:

For the following questions, assume an end-of-year cash flow of $250 and a 10% discount rate.
a. What is the present value of a single cash flow?
b. What is the present value of a 5-year What is the present value of a 10-year What is the present value of a 100-year What is the present value of a $250 perpetuity?
f. Do you detect a relationship between the number of periods of an and its resemblance to a perpetuity? Explain.
Annuity
An annuity is a series of equal payment made at equal intervals during a period of time. In other words annuity is a contract between insurer and insurance company in which insurer make a lump-sum payment or a series of payment and, in return,...