Need help with this accounting question Find the annual interest rate that would create a perpetual cash flowstream of $20,000 when the present value of the asset is $250,000.a. 2.5 percentb. 25 percentc. 12.5 percentd. 8 percent

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Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter12: Capital Investment Analysis

Section: Chapter Questions

Problem 3BE

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Find the annual interest rate that would create a perpetual cash flow stream of $20,000 when the present value of the asset is $250,000. a. 2.5 percent b. 25 percent c. 12.5 percent d. 8 percent