Question: A perpetuity pays $ 1 0 0 each and every year forever. The duration of this perpetuity will be _ _ _ _ _ _

A perpetuity pays $100 each and every year forever. The duration of this perpetuity will be __________blank if its yield is 8.8%.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!

Q:

Data Auditing As a member of the audit team examining MPLs payroll expense, you have gathered a list of current employees names and salary amounts. Prepare a descriptive analysis of payroll expense...

Q:

A perpetuity pays a constant dividend of $3.9 every year forever. Its current price is $58.19.What is the duration of the perpetuity?

Q:

A perpetuity pays 1 at the end of every year plus an additional 1 at the end of every other year starting in the second year. The present value of the perpetuity is K for i > 0. Determine K .

Q:

9. (16 points)A perpetuity pays $1 at the end of every year plus an additional $1 at the end of every second year. The anual effective rate of interest is i = 496. Find the present value of the...

Q:

sice the last payment. 8. A perpetuity pays 1 at the end of every year plus an additional 1 at the end of every second year. The present value of the perpetuity is K for i >0. Show that K = i + 3...

Q:

Your company reported the following information: Sales => $97,000,000 Cost of Goods Sold = 65% of Sales Operating Expenses Interest expense = = 5% of Sales $123,000 Operating capital = $10 million,...

Q:

Calculate the present values at t = 0 ( now ) of the following cash flows: a . $ 1 0 0 every year forever, with the first payment at t = 1 ( t counts years ) , where the effective annual rate is . 0...

Q:

Consider the case of the following annuities and the need to compute either their expected rate of return or duration Jacob inherited an annuity worth $5,660.74 from his uncle. The annuity will pay...

Q:

1. Which of the following are characteristics of a perpetuity? Check all that apply. The current value of a perpetuity is based more on the discounted value of its nearer (in time) cash flows and...

Q:

9. Perpetuities Perpetuities are also called annuities with an extended, or unlimited, life. Based on your understanding of perpetuities, answer the following questions. Which of the following are...

Q:

Hello. I'm looking for some help completing my finance project. (10% total course grade) There are quite a few questions. (40 total) I can check the answers one time before submitting. Hoping for...

Q:

The Howard Mobile Home Manufacturing Company is audited by Olson and Riley, CPAs. Howard Mobile Home has decided to issue stock to the public and wants Olson and Riley to perform all the audit work...

Q:

Give the mathematical relationships between the members of each possible pair of the three quantities Go, Eo cell, and K.

Q:

Consideration of Liability Protection includes Group of answer choices Assess your risk tolerance and growth aspirations for the business. Choose a structure that aligns with your risk tolerance and...

Q:

Solve B. 6a2-23a +20. a +2 2a2-a-10 2a-5