a. Derive an expression for the value and duration of a perpetuity of $c per annum...

 

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a. Derive an expression for the value and duration of a perpetuity of $c per annum if interest rates are level at r %? The following sums of infinite series might prove useful for your solution: x + x² + x³+...= x 1-x x + 2x² + 3x³+...= X (1-x)² a. Derive an expression for the value and duration of a perpetuity of $c per annum if interest rates are level at r %? The following sums of infinite series might prove useful for your solution: x + x² + x³+...= x 1-x x + 2x² + 3x³+...= X (1-x)²

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To derive an expression for the value and duration of a perpetuity of c per annum with an interest r... View the full answer