Question

- A perpetuity with an annual payment of $1,000 (payments start N years from today) has a present value (today) of $6,830. A second perpetuity, which will begin five years after the first perpetuity begins, has a present value of $8,482. The annual interest rate is 10 percent.

**Determine the value of each
payment of the second perpetuity?**

Answer #1

A perpetuity will make annual payments with the first payment
coming 9 years from now. The first payment is for $4700, and each
payment that follows is $150 dollars more than the previous one. If
the effective rate of interest is 6.2%, what is the present value
of the perpetuity?
Answer = $

(1 pt) A perpetuity will make annual payments, with the first
payment coming 9 years from now. The first payment is for 4700
dollars and each payment that follows is 120 dollars more than the
one before. If the effective rate of interest is 5.2 percent, what
is the present value?
Answer = dollars.

1. Perpetuities in arithmetic progression. If a perpetuity has
first payment P and each payment increases by Q, then its present
value, one period before the first payment, is P/i + Q/i^2 Using
this formula, find the present value of a perpetuity-immediate
which has annual payments with first payment $360 and each
subsequent payment increasing by $40, at annual interest rate
1.3%.
The answer should be ($264,378.70).
2. Filip buys a perpetuity-immediate with varying annual
payments. During the first 5...

Jones purchased a perpetuity today for $7, 000. He will receive
the first annual payment of $200 five years from now. The second
annual payment will be $200 plus an amount C. Each subsequent
payment will be the prior payment plus an additional constant
amount C. If the effective annual interest rate is 4%, find C. I
know the answer is 5.1 but I'm not sure how to get there.

A perpetuity pays $390.26 at the start of each year.
The present value of this perpetuity at an annual effective
interest rate i is equal to the present
value of an annuity which pays 800 at the start of the first year,
790 at the start of the second year,
780 at the start of the third year and so on for 20 years. Find i
to 1 significant figure.

You are given a perpetuity that makes payments every two years,
with a payment at the beginning of the year numbered 2n + 1, for n
= 0, 1, 2, …, equal to 1/((n+1)(n+2)*3n). Find the
present value of this perpetuity at time 0, given that the annual
effective interest rate is 4.5%.

What is the present value today of a deferred annuity of 10
annual payments of $1,000 each, if the first payment will be
received 6 years from now and the discount rate is 9% EAR?
(Round to the nearest whole dollar)

A 10-year annuity has annual payments of $1,000. The first
payment is in 1 year. If interest is 5%p.a (effective annual rate)
for the first 3 years followed by 6%p.a (effective annual rate) for
7 years, what is the future value of this annuity at the end of 10
years?
Select one:
a. $13,134.03
b. $13,001.45
c. $12,002.34
d. $13,969.78

1. A perpetuity-due has monthly payments in this pattern: Q, 2Q,
3Q, Q, 2Q, 3Q, Q, 2Q, 3Q, . . . The present value of the perpetuity
is $700,000 and the effective annual discount rate is 6%. Find
Q.
2. A 30 year annuity-immediate has first payment $1200 and each
subsequent payment increases by 0.5%. The payments are monthly and
the annual effective rate is 8%. Find the accumulated value of the
annuity at the end of 30 years.
3....

You will receive 26 annual payments of $41,500. The first
payment will be received 6 years from today and the interest rate
is 5.8 percent. What is the value of the payments today?

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