Dropdown #1 Choices: reduce or increase

Dropdown #2 Choices: 0.61%, 0.45%, 0.50 %, 0.53%

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 characteristics of a perpetuity? Check all that apply. A perpetuity is a series of regularly timed, equal cash flows that is assumed to continue indefinitely into the future. A perpetuity continues for a fixed time period. In a perpetuity, returns-in the form of a series of identical cash flows-are earned. The present value of a perpetuity is calculated by dividing the amount of the payment by the investor's opportunity interest rate. A local bank's advertising reads: "Give us $25,000 today, and we'll pay you $200 every year forever." If you plan to live forever, what annual interest rate will you earn on your deposit? 0.96% 0.80% 0.72% 1.12% Oops! When you went in to make your deposit, the bank representative said the amount of required deposit reported in the advertisement was incorrect and should have read $37, 500. This revision, which will ___ the interest rate earned on your deposited funds, will adjust your earned interest rate to ___