Explanation Investment pays a dividend continuously forever so, it can be treated as perpetuity . Given: D = $ 250 / y e a r r = Discout Rate 100 = 7 100 = 0.07 Formula Used: P V = D r D = Dividend/ year

3rd Edition

ISBN: 9781464125263

Author: Jon Rogawski, Colin Adams

Publisher: W.H. Freeman & Co

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Chapter 8.7, Problem 79E

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Present Value of an income stream generated by the investment.

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Chapter 8.7, Problem 78E

Chapter 8.7, Problem 80E

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Chapter 8 Solutions

Calculus - Standalone book

Ch. 8.1 - Prob. 1PQ Ch. 8.1 - Prob. 2PQ Ch. 8.1 - Prob. 3PQ Ch. 8.1 - Prob. 1E Ch. 8.1 - Prob. 2E Ch. 8.1 - Prob. 3E Ch. 8.1 - Prob. 4E Ch. 8.1 - Prob. 5E Ch. 8.1 - Prob. 6E Ch. 8.1 - Prob. 7E

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Present Value of an income stream generated by the investment.

Solution Summary: The author explains that investment pays a dividend continuously forever so, it can be treated as perpetuity.

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Present Value of an income stream generated by the investment.

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