A Perpetuity Will Pay $1000 Per Year,starting Five Years After

question 18

Multiple Choice

A perpetuity will pay $1000 per year,starting five years after the perpetuity is purchased.What is the present value (PV) of this perpetuity on the date that it is purchased,given that the interest rate is 4%?

• A)$1410
• B)$20,582
• C)$21,370
• D)$34,604

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Definitions:

Empire

A group of nations or peoples ruled over by an emperor, empress, or other powerful sovereign or government, often comprising different territories and peoples.

Grant's Abilities

Refers to the military and leadership qualities of Ulysses S. Grant, 18th President of the United States and commanding general during the American Civil War.

Strategic Aims

Long-term goals that an organization or individual plans to achieve, which guide decision-making and direction.