Question: How much more current value does a perpetuity of $140 a year have as compared to an annuity of $140 a year for 50 years

How much more current value does a perpetuity of $140 a year have as compared to an annuity of $140 a year for 50 years given an interest rate of 7.4 percent?

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!

spreadsheet template: The Poughkeepsie Development Corporation (PDC) is trying to complete its investment plans for the next five years. Currently PDC has $4.9 million available for investment....

A. Two years ago, you opened an investment account and deposited $6,000. One year ago, you added another $2,100 to the account. Today, you are making a final deposit of $8,000. How much will you have...

1) How much more current value does a perpetuity of $130 a year have as compared to an annuity of $130 a year for 50 years given an interest rate of 7.3 percent? $38.36 $52.56 $70.73 $33.78 2) What...

FINANCE work 5 Question 5 (of 26) value: 3.00 points How much more current value does a perpetuity of $160 a year have as compared to an annuity of $160 a year for 50 years given an interest rate of...

Two years ago, you opened an investment account and deposited $22,000. One year ago, you added another $3,700 to the account. Today, you are making a final deposit of $16,000. How much will you have...

How much more current value does a perpetuity of $230 a year have as compared to an annuity of $230 a year for 50 years given an interest rate of 8.3 percent? $37.23 $51.43 $69.60 $32.65

Assume you deposit $200 per year into an account earning 10% annually with the first deposit made exactly one year from today (t-1) and the last deposit is made in exactly 7 years (t=7). There are...

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...

What is the present value of a perpetuity that pays 1,000 per year, beginning one year from now, if the appropriate interest rate is 5%? PMT 1,000 I 5% PV= What would the value be if the perpetuity...

just answer with letters Multiple Choice Questoins 1. Which one is a key characteristic of the bond! a present value b.pure value c. perfect value d. par value 2. A bond is. a. a certificate that is...

Multiple Choice Questoins (5 points each) 1. Which one is a key characteristic of the bond? a present value b. pure value c. perfect value d. par value 2. A bond is ... a a certificate that is a...

Refer to Problem 9. Based on your answer there, would foreign countries have a reason to object to the use of a sales tax on cigarettes by the United States? Based on your knowledge of the GATT/WTO...

Suppose that consumer preferences are changing, so that more consumers want to buy chicken and fish and fewer want to buy beef and pork. a. If inflation is low and fully anticipated, how would you...

Describe the effect of increasing resolution and sampling rate on the size of a file being stored in a computer.

Exercise 11-13 Sell or Process Further Decision (LO11-7) Wexpro, Inc., produces several products from processing 1 ton of clypton, a rare mineral. Material and processing costs total $69,000 per ton,...