James Is a Law Student Who Wishes to Understand How

question 77

Multiple Choice

James is a law student who wishes to understand how a perpetuity works.His grandfather invested in a perpetual bond 25 years ago,which pays $15,000 annually at a 12% interest rate.What was the present value of the cash flows of this perpetuity when it was purchased?

• A)$84,753.35
• B)$150,000
• C)$125,000
• D)$133,928.57
• E)$16,800

---

Definitions:

Work Group

A collection of individuals who collaborate towards achieving a common goal, often characterized by shared responsibilities and interdependence.

Peers

Individuals who are equal to one another in terms of status, age, or another specific criterion, often considered within a social or professional context.

Core Values

Fundamental beliefs or principles that act as guiding lights for behavior and decision-making within an organization or individual life.

Ethical Decision Making

The process of evaluating and choosing among alternatives in a manner consistent with ethical principles, considering the impact of decisions on stakeholders.