Question: Please show your work so I can see how you got your answers. 3. Consider a perpetuity that pays $60 a year each year with

Please show your work so I can see how you got your answers.

3. Consider a perpetuity that pays $60 a year each year with the first payment being a year from now. The discount rate is 8%. What is the PV of the perpetuity?

4. Consider the perpetuity in question 3 except now the first payment is today rather than a year from now. What is the PV of the perpetuity now?

5. Consider a growing perpetuity that has an initial payment today of $100. After that the annual payment increases by 5% a year forever. The discount rate is 10%. What is the PV of the growing perpetuity?

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