# 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 annuity?

c. What is the present value of a 10-year annuity?

d. What is the present value of a 100-year annuity?

e. What is the present value of a $250 perpetuity?

f. Do you detect a relationship between the number of periods of an annuity and its resemblance to a perpetuity? Explain.

a. What is the present value of a single cash flow?

b. What is the present value of a 5-year annuity?

c. What is the present value of a 10-year annuity?

d. What is the present value of a 100-year annuity?

e. What is the present value of a $250 perpetuity?

f. Do you detect a relationship between the number of periods of an annuity and its resemblance to a perpetuity? Explain.

## Answer to relevant Questions

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