What is the present value (PV) today of a stable perpetuity that pays $11,000 every 3 years, starting 7 years from today? The appropriate annual discount rate is 12% p.a. Round your answer to the nearest dollar.
What is the present value (PV) today of a stable perpetuity that pays $11,000 every 3 years, starting 7 years from today? The appropriate annual discount rate is 12% p.a. Round your answer to the nearest dollar.
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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What is the present value (PV) today of a stable perpetuity that pays $11,000 every 3 years, starting 7 years from today? The appropriate annual discount rate is 12% p.a. Round your answer to the nearest dollar. Do not include the $ symbol nor the separating comma, if any Thus, for example, if the PV is $24,323 55 write 24324 in the answer box. IMPORTANT. Use at least 4 decimals in all your intermediate calculations In the case of a discount rate, the 4-decimal requirement applies to the percentage version; that is, the decimal version would have 6 decimals. For example, 12345% would become 0,012345. Write your answer rounded to the dollar, e.g., 6543 (Acceptable error = 200)
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