Question: Draw a time line ( horizontal ) showing: Perpetuity 1 : $ 1 0 0 starting from year 1 , forever and Perpetuity 2 :

Draw a time line (horizontal) showing: Perpetuity 1: $100 starting from year 1, forever and Perpetuity 2: $100 starting from year 6, forever. Both at 6% discount rates The annuity is the difference between these two perpetuities.

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