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Question:
How much is $100 at the end of each year forever at 10% interest worth today?
Present Value:
The concept 'time value of money' is useful in finding out the worth of money at a given point of time, either in present or in the future. The worth of money received today is different than the worth of money received after one year.
Answer and Explanation:1
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Present value of perpetuity:
When a stream of income is expected to be earned indefinitely, the present value of such income is calculated using...
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Perpetuity Definition, Formula & Examples
from
Chapter 6/ Lesson 4
14K
Learn what perpetuity is in finance. Understand the meaning and definition of perpetuity, its characteristics and how its present value can be found using a formula.
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