What is the present value of a perpetuity stream of cash flows that pays $1,000 at the

Question:

What is the present value of a stream of cash flows that pays $1,000 at the end of Year 1, and the annual cash flows grow at a rate of 4 percent per year indefinitely, if the appropriate is 8 percent? What if the appropriate is 6 percent?

Discount Rate
Depending upon the context, the discount rate has two different definitions and usages. First, the discount rate refers to the interest rate charged to the commercial banks and other financial institutions for the loans they take from the Federal... Perpetuity
Perpetuity refers to payments that are made without an end or maturity date. A perpetuity is classified as an annuity, which is something that earns a dividend or receives a payment at a regularly scheduled interval, generally yearly. So, how...