Question 6The owner of a cemetery plans to offer a perpetual care service for grave sites. The owner estimates that it willcost $120 per year to maintain a grave site. If the interest rate is 8%, what one-time fee should the owner chargefor the perpetual care service?

Perpetual stream of cash flow is the cash flow that occur forever. The value of perpetual cash…

Answered: The ouner of a cemetery plans to offer…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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The ouner of a cemetery plans to offer a perpetual care service for grave sites. The ouner estimates that it will cost $120 per year to maintain a grave site. If the interest rate is 8%, what one-time fee should the owner charge for the perpetual care service?