Your aunt in her will left you the sum of $5000 a year forever with payments starting immediately. However, the news is better. She has specified that the amount should grow at 5% per year to maintain purchasing power. Given an interest rate of 12% . (1) what is the PV of the inheritance.
Your aunt in her will left you the sum of $5000 a year forever with payments starting immediately. However, the news is better. She has specified that the amount should grow at 5% per year to maintain purchasing power. Given an interest rate of 12% . (1) what is the PV of the inheritance.
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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Your aunt in her will left you the sum of $5000 a year forever with payments starting immediately. However, the news is better. She has specified that the amount should grow at 5% per year to maintain
(1) what is the PV of the inheritance.
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