Ally Wishes to Leave a Provision in Her Will That

question 7

Multiple Choice

Ally wishes to leave a provision in her will that $7000 will be paid annually in perpetuity to a local charity. How much must she provide in her will for this perpetuity if the interest rate is 6%?

• A) $58,334
• B) $93,334
• C) $116,667
• D) $70,000

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Definitions:

Debt Financing

The process of raising capital through borrowing money, which must be repaid with interest.

Crowd Sourcing

The practice of obtaining information, ideas, or content by soliciting contributions from a large group of people, typically from the online community, rather than from traditional employees or suppliers.