You Just Inherited a Trust That Will Pay You $100,000

question 97

Multiple Choice

You just inherited a trust that will pay you $100,000 per year in perpetuity. However, the first payment will not occur for exactly five more years. Assuming an 8 percent annual interest rate, what is the value of this trust?

• A)$850,729
• B)$918,787
• C)$1,000,000
• D)$1,250,000

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Definitions:

Aversive Event

An unfavorable or unpleasant event intended to decrease the likelihood of a behavior by association.

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A vital liquid in humans and many animals, composed of cells and plasma, that circulates through the body delivering oxygen and nutrients while removing waste products.

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Turbulence refers to violent or unsteady movement of air or water, or a situation characterized by conflict or confusion.