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:

Accommodation

The process of adjusting or adapting oneself to different conditions, environments, or circumstances.

Avoidance

Conflict management style that involves backing off and trying to sidestep conflict.

Paraphrasing

Restating someone else’s ideas or thoughts in one's own words, often to clarify meaning or demonstrate understanding.

Identifying Your Goal

The process of determining what you aim to achieve in a particular situation or endeavor.