AB Company Has Decided to Donate to the Children's Hospital

question 10

Multiple Choice

AB Company has decided to donate to the children's hospital every year.The company 's first payment will be $1 million and it will grow at a constant rate of 3% forever.What is the present value of this growing perpetuity if the current market rate is 5%?

• A)$150 million
• B)$20 million
• C)$33.33 million
• D)$53.33 million
• E)$50 million

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Definitions:

Partial Hospitalization

A treatment program that provides intensive psychiatric or substance abuse treatment on an outpatient basis, mimicking the level of care of inpatient facilities.

IOP

Intensive Outpatient Program; a treatment program that provides frequent services but allows individuals to live at home.

Quadrants of Care

A framework used in healthcare to classify services based on the complexity and severity of medical and behavioral health needs.

Psychiatric Disorders

A range of mental health conditions marked by alterations in thinking, mood, or behavior associated with distress or impaired functioning.