Which of the Following Is Correct Concerning Perpetuities

question 319

Multiple Choice

Which of the following is correct concerning perpetuities?

• A) Perpetuities consist of a stream of equal payments.
• B) Perpetuities have a life of between twenty and one hundred years.
• C) Perpetuities have a variable rate of return.
• D) The present value perpetuity formula for a stream of annual payments is: C/(1 + r/12)12.
• E) Perpetuities do not occur in real life situations.

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Definitions:

Egocentrism

In psychology, the inability to differentiate between one's own perspective and another person's perspective.

Piaget

A Swiss psychologist known for his pioneering work in developmental psychology, especially his theory of cognitive development in children.

Object Permanence

The cognition that objects still exist even when they are no longer perceivable through sight, hearing, or other senses.

Conservation

Conservation is a principle in cognitive development, identified by Jean Piaget, referring to a child's ability to recognize that certain properties of objects, like volume and number, can remain the same despite changes in the form or arrangement of those objects.