A client is considering two possible investments, each pays $10,000 per year (end of year). (timeline not required)

A 30-year annuity, 15 percent compounded annually, OR
A perpetuity, 15 percent compounded annually.
 

Which investment would you recommend and why? (show all calculations)

Answer rating: 100% (QA)

To determine which investment to recommend we need to compare the present values of the two investme... View the full answer