Which of the Following Statements Regarding Perpetuities Is False

question 52

Multiple Choice

Which of the following statements regarding perpetuities is false?

• A) To find the value of a perpetuity one cash flow at a time would take forever.
• B) A perpetuity is a stream of equal cash flows that occur at regular intervals and lasts forever.
• C) PV of a perpetuity =
• D) One example of a perpetuity is the British government bond called a consol.

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Definitions:

Straight-Line Method

A method of calculating the depreciation of an asset that evenly spreads out its cost over its useful life.

Entertainment Expenses

Costs for business-related entertainment that may be partially deductible under certain conditions.

Listed Property

Assets required to be reported for tax purposes because they have the potential for personal use, such as cars, computers, and real property.

Standard Mileage Rate

The IRS-set rate per mile that taxpayers can use to calculate deductions for business, charitable, medical, or moving purposes when using a vehicle.