Which Is the Best Definition of a Perpetuity

question 108

Multiple Choice

Which is the best definition of a perpetuity?

• A) The interest rate charged per period multiplied by the number of periods per year.
• B) An annuity for which the cash flows occur at the beginning of the period.
• C) A constant stream of cash flows without end that is expected to rise indefinitely.
• D) An annuity in which the cash flows continue forever.
• E) A level stream of cash flows for a fixed period of time.

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Definitions:

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The value of one currency for the purpose of conversion to another, indicating how much of one currency can be exchanged for another.

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A period during the summer months where individuals take a break from work or school activities, often involving travel or leisure activities.