What's the Present Value of a Perpetuity That Pays $250

question 103

Multiple Choice

What's the present value of a perpetuity that pays $250 per year if the appropriate interest rate is 5%?

• A)$4,750.00
• B)$5,000.00
• C)$5,250.00
• D)$5,512.50

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Definitions:

Northwest Territory

Territory established by the Northwest Ordinance of 1787, covering what would become the states of Ohio, Indiana, Illinois, Michigan, Wisconsin, and part of Minnesota.

Slavery

Slavery is a system in which individuals are owned by others, deprived of personal freedom, and forced to perform labor or services.

Plantation Farming

An agricultural production system characterized by large-scale monoculture farming, often historically reliant on slave or cheap labor.

Missouri

A U.S. state located in the Midwestern region, known for its diverse geography, ranging from the Ozark Mountains to the Mississippi River.