A Perpetuity Has a PV of $20,000

question 30

Multiple Choice

A perpetuity has a PV of $20,000. If the interest rate is 6%, how much will the perpetuity pay every year?

• A) $600
• B) $960
• C) $1200
• D) $720

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Definitions:

Scalar Chain Principle

A management theory that suggests a clear and formal line of authority in an organization from the top down.

Communication

The process of sharing information, ideas, and feelings through verbal or non-verbal means between individuals or groups.

Scientific Management

A theory of management that analyzes and synthesizes workflows to improve economic efficiency and labor productivity.

Job Satisfaction

A measure of how content an individual is with their job; it involves various factors including the nature of the work, compensation, work conditions, and colleagues.