4. A tract of land is leased in perpetuity at $1250 due at the beginning of each month. If money is worth 7.5% compounded monthly, what is the present value of the lease? 5. What is the present value of perpetuity payments of $750 made at the beginning of each month if interest is 8.5% compounded semi-annually? 3. An investment of $50,000 is made in preferred shares that pay dividends of $3000 at the end of each year indefinitely. What annually compounded rate is paid by the shares?
4. A tract of land is leased in perpetuity at $1250 due at the beginning of each month. If money is worth 7.5% compounded monthly, what is the present value of the lease? 5. What is the present value of perpetuity payments of $750 made at the beginning of each month if interest is 8.5% compounded semi-annually? 3. An investment of $50,000 is made in preferred shares that pay dividends of $3000 at the end of each year indefinitely. What annually compounded rate is paid by the shares?
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
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Transcribed Image Text:4. A tract of land is leased in perpetuity at $1250 due at the beginning of each month. If money is worth
7.5% compounded monthly, what is the present value of the lease?
5. What is the present value of perpetuity payments of $750 made at the beginning of each month if
interest is 8.5% compounded semi-annually?
3. An investment of $50,000 is made in preferred shares that pay dividends of $3000 at the end of each
year indefinitely. What annually compounded rate is paid by the shares?
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