What Is the Present Value of $10,000 Per Year in Perpetuity

question 100

Multiple Choice

What is the present value of $10,000 per year in perpetuity at an interest rate of 10%?

• A)$10,000
• B)$100,000
• C)$200,000
• D)$1,000

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Definitions:

Condition Precedent

A legal term for a condition or event that must occur before a contract becomes effective or before an obligation must be performed.

Power of Attorney

A formal document that gives one person (the agent) the power to represent another (the principal) in matters of law or finance.

Seal

A device or substance used to close or secure an object or document, often signifying authenticity, confidentiality, or approval.

Subsequent Agreement

An agreement made after a written agreement that alters or cancels the written agreement.