Which of the Following Formulas Is Incorrect

question 44

Multiple Choice

Which of the following formulas is incorrect?

• A) PV of a growing annuity = C ×
• B) PV of an annuity = C ×
• C) PV of a growing perpetuity =
• D) PV of a perpetuity =

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Definitions:

Elasticity of Demand

A gauge for the responsiveness of how much a product is wanted relative to fluctuations in its price.

Inelastic Demand

A market situation where the demand for a product does not significantly change with a change in price.

Elastic Demand

A market condition where the demand for a product or service significantly changes in response to price changes.

Opportunity Cost

The cost of a missed opportunity; the value of the best alternative forgone.